February 24, 2022
USD/CAD: The Canadian dollar strengthened against the U.S. dollar on Wednesday but gave up much of its advance as rising Russia-Ukraine tensions weighed on investor sentiment. Sanctions were not yet expected to disrupt oil supplies, helping to cap the price of oil, one of Canada’s major exports, after it notched a seven-year high on Tuesday. The Bank of Canada is expected to hike next Wednesday for the first time since October 2018. The loonie was up 0.2% at 1.2745 to the greenback, after earlier touching its strongest level since last Friday at 1.27. Immediate resistance can be seen at 1.28. A breakout to the upside can trigger growth towards 1.2850.
BUY STOP 1.2800/TP 1.2850/SL 1.2780
GBP/USD: Sterling edged down versus the dollar and euro on Wednesday after Bank of England Governor Andrew Bailey said there were clear inflation risks, but markets should not get carried away over the likely scale of interest rate hikes. Speaking about the BoE’s decision earlier this month to raise interest rates, Bailey said he saw a clear risk of inflation sticking at high levels, adding that second-round effects are a concern, which could require more hikes. Despite this, geopolitical risks are now in the spotlight, which will not allow the risk to grow. Immediate support is seen at 1.3480. A breakout below could take the pair towards 1.3400.
SELL STOP 1.3480/TP 1.3400/SL 1.3510
EUR/USD: The euro declined on Wednesday. The head of the ECB, Christine Lagarde, announced at the last meeting that the financial authorities intend to avoid an increase in the rate and rely on the fact that inflation will be corrected by natural causes. Coupled with deteriorating market sentiment, the European central bank’s doubts about the need to raise rates could further weaken the euro. Another factor for the euro’s decline is the strengthening of the U.S. dollar. Immediate support is seen at 1.12. A breakout below could take the pair towards 1.1150.
SELL STOP 1.12/TP 1.1150/SL 1.1220