[DAILY NOTION] InvestingCube - GBP/CAD Forecast - Oct 21, 2020

GBP/CAD has been consolidating within a range and has been unable to get a clear direction. The price is trading under the 50-day moving average and this shows weakness in the pound. The Canadian dollar could look to target the 1.6800-6900 support levels.

Outlook: Short positions could target those levels with a stop at 1.71500.

To recap, GBP/CAD was down 0.10% on the day as the pair continues to drift lower on Brexit and oil prices. The EU summit last week failed to produce anything tangible in terms of a deal and there is animosity towards any further talks with U.K. Prime Minister Boris Johnson suggesting that the country would “prosper mightily” by targeting an Australian-style trade deal.

Oil prices are still supporting the Canadian currency with crude still trading above the $40.00 level after yesterday’s OPEC meeting which saw the group pledge action to support prices as demand wanes.

The committee had committed to a sharp production cut scheduled for December but this has come under criticism due to the ongoing virus surge and lockdown restrictions. Libya is set to see a production increase after tensions in the country cooled and OPEC may have to revise their planned cut, but still counter the Libyan increase.

Source: https://www.investingcube.com/...