The most interesting about AUDCAD!

The fate of former British colonies always was quite impressive. Nowadays many of these colonies are highly-developed and attractive for investments countries. Also, it is quite interesting that the location of these places is diametrically opposed to each other. However, let's check if today there are enough arguments to start trading with the AUDCAD asset this week.

Today we will consider one exciting strategy, which is based on the monetary policies of the aforementioned countries.

Basic arguments

As far as we know, today the interest rate in Canada is 1,75% and in Australia is 1,5%. With such a ratio we can assume that investments to Canada look more attractive and profitable, which means that in case of lower demand for AUD (or at times of stability), the asset will aim to the CAD side, and the price will go down blowing traders' heads all over the world. According to such controversial debates within the last couple of weeks, the asset keeps many traders at losses.

Today's fair price for AUDCAD is 0,9498.

Technical arguments

Picture 1. The price chart of AUDCAD for 07.04.2019 - 07.05.2019.

As we can see in picture 1, the current price by transforming into a correction, drives the market towards the direction of a fair price of AUDCAD.

Moreover, the current situation technically hints for the continuation of a trend. However, we can assume with full objectivity that there are no further reserves for price falling of this instrument.

Analysis of big traders' positions

Picture 2. The price chart of AUDCAD and the chart of the index of big traders for 07.04.2019 - 07.05.2019.

In picture 2 we can see that the volume of positions goes as smoothly as a fair depreciation (changing of the price downwards) of AUD against CAD.

Forecast:

To underline all this, we can conclude that near term of AUDCAD will be connected with an upside correction, which means that it is better to invest "up".

As for the instruments to assess the situation, we can suggest the following technical indicators:

- ROC;

- RSI (Relative Strength Index).

Also, in order to control the situation with your positions, it is better to keep the ratio of opened deals as follows: 3 trades "up", 2 trades "down".