The Canadian Dollar (CAD) – a feature of trading on cross-rates. Anton Hanzenko13.03.2018, 11:00 AM
The Canadian dollar (CAD) refers to commodity currencies along with the Australian and New Zealand dollar, which makes the dynamics of these currencies very similar. But the Canadian can be distinguished by some specific features, for example, geopolitics. The Canadian dollar is the seventh most popular, while it is very actively traded on the foreign exchange market.
Canadian economy’s data
The Bank of Canada acts as the central financial institution of Canada and responsible for monetary policy. The Canadian economy has a stable level of inflation of 2%, which positively allocates Canada against the background of the US and the eurozone. In addition, the Canadian economy doesn’t need the practice of refinancing and stimulating the economy, which also positively allocates it against the backdrop of the Eoropean countries.
The dynamics of Canada’s GDP favorably stands out against the background of the G8 countries from the period from 1992 to 2009.
At the same time, even in the post-crisis period, Canada’s GDP remains very optimistic.
Due to the fact that the territory of Canada is rich in minerals, the Canadian dollar refers to commodity currencies. As a result, it can be put on a par with the Australian and New Zealanders. But, because of the geographical location, the neighborhood with the United States, Canada is the main trading partner of the United States.
Economic relations between Canada and the US are defined by a number of trade agreements: the Canadian-American Free Trade Agreement 1989 (FTA) and the North American Free Trade Agreement 1994 (NAFTA). Thus, the possibility of a US trade war would have a detrimental effect on the Canadian economy, which was traced almost throughout February.
At the moment, concerns about tightening trade relations between the US and Canada have declined, which is also indicated by the correction.
Stock index of Canada is S&P/TSX 60, which includes 60 large companies and represents 10 industries. The S&P/ TSX 60 index (red line) and the USD / CAD pair have a direct correlation, which can be used as a leading signal to enter the trade.
Since the Canadian dollar refers to commodity currencies, it is well correlated with other commodity currencies.
The Canadian dollar refers to commodity currencies, which makes its analysis more straightforward. Also pairs containing Canadian differ very high degree of trend movement.
In trading slang, the pair USD / CAD is called “luni”.
A $ 100 Canadian dollar note is issued with a single plastic polymer, which makes it impossible to forge it.