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Re: Exchange rate
Things have changed dramatically in the last couple of weeks.
Firstly, the US fed have finally embarked on the battle against inflation, they figure the housing market can't get any worse and the measures in place already will aid it as much as they can. Now it is joining the battle the ECB have been engaged in for sometime. Fighting inflation caused by skyrocketing prices of resources, be it gas, steel, corn, wheat, gold etc. The next move by the Fed is a hike in rates, and i expect it sooner than most. They are aided by a long awaited collapse in the price of gas and other resources, finally demand is slowing down. We stopped about $1 short of $150 a barrel in gas, and it has fallen from $149 to $114 in 3 weeks. This even though we have a war just starting between Russia and Georgia and the heightened possibility of Israel and Iran getting it on very shortly. So we have the US dollar finally starting to reverse years of decline, the Canadian economy firmly feeling the pinch from the slowdown in the US, and falling Oil prices. All should lead to a weaker CAD$, it is just a question of against which currencies it will fair better or worse. The Euro is the safest investment at the moment and will continue to be for sometime to come, the US$ is looking like a better investment daily against the CAD$, the moment oil breaks down through $100 a barrel or the US Fed hike rates that becomes even more the case. The one that really puzzles me is Sterling. Just how bad can Gordon Brown screw things up?? He continues to throw money at public services like they are bottomless pits, as Oil comes down so does the governments cut of the VAT, and going into an election year he is unlikely to increase fuel duty, leading to less government revenue, the housing crash has seen a massive slowdown in their thieving via the stamp duty, all this leads to HUGE borrowing by the government and will have many many long term effects, sooner or later they will have to raise the tax burden, be it personal tax or corporation tax, this makes the UK a questionable investment. Therefore although you read many articles on the negative CAD$ sentiment in the market in the coming months, please be aware that most of you are looking for a move against a similar currency which has mounting negative sentiment aswell. Hope that helps. Chris |
Re: Exchange rate
has anyone thought about buying a different currency then changeing it to cad, rather than uk-cad.
maybe uk - euro then from euro to cad would that work ????? or am i being blonde |
Re: Exchange rate
sorry but very blonde!! When i trade daily i am up against computer programs designed by rocket scientists. It gets increasing harder to outsmart these things, they are what we call 'black boxes'. If there was any trading opportunity to be had by doing what you are suggesting then the computer models have already done it, what they do is look at the markets and trade the arbitrage, basically if a price becomes out of line which the underlying instruments then they will buy or sell it until it realigns itself.
Example. If the CAD$ v GBP was trading 2.00 but by trading GBP v Euro and then Euro v CAD$ you could achieve a rate of 2.03 then the black box would basically buy up CAD$ v GBP to 2.03 or sell the relevant other contracts to push the indirect price to 2.00. And they would do this before you had the chance to look twice at the screen. No offense intended but a currency broker might not tell you this as they just want your commission, i would rather put you in the picture from the start. Chris |
Re: Exchange rate
thanks chris thought i might of being blonde :o but hey unless you ask you dont know :D
anyway thanks for the insight |
Re: Exchange rate
Originally Posted by cneldred
(Post 6662720)
Things have changed dramatically in the last couple of weeks.
Firstly, the US fed have finally embarked on the battle against inflation, they figure the housing market can't get any worse and the measures in place already will aid it as much as they can. Now it is joining the battle the ECB have been engaged in for sometime. Fighting inflation caused by skyrocketing prices of resources, be it gas, steel, corn, wheat, gold etc. The next move by the Fed is a hike in rates, and i expect it sooner than most. They are aided by a long awaited collapse in the price of gas and other resources, finally demand is slowing down. We stopped about $1 short of $150 a barrel in gas, and it has fallen from $149 to $114 in 3 weeks. This even though we have a war just starting between Russia and Georgia and the heightened possibility of Israel and Iran getting it on very shortly. So we have the US dollar finally starting to reverse years of decline, the Canadian economy firmly feeling the pinch from the slowdown in the US, and falling Oil prices. All should lead to a weaker CAD$, it is just a question of against which currencies it will fair better or worse. The Euro is the safest investment at the moment and will continue to be for sometime to come, the US$ is looking like a better investment daily against the CAD$, the moment oil breaks down through $100 a barrel or the US Fed hike rates that becomes even more the case. The one that really puzzles me is Sterling. Just how bad can Gordon Brown screw things up?? He continues to throw money at public services like they are bottomless pits, as Oil comes down so does the governments cut of the VAT, and going into an election year he is unlikely to increase fuel duty, leading to less government revenue, the housing crash has seen a massive slowdown in their thieving via the stamp duty, all this leads to HUGE borrowing by the government and will have many many long term effects, sooner or later they will have to raise the tax burden, be it personal tax or corporation tax, this makes the UK a questionable investment. Therefore although you read many articles on the negative CAD$ sentiment in the market in the coming months, please be aware that most of you are looking for a move against a similar currency which has mounting negative sentiment aswell. Hope that helps. Chris |
Re: Exchange rate
Does anyone use www.xe.com for there exchanges? They guarentee best rate (normally about half a pip of midmarket rate) If not why not? I just opened my trading account with them and added a CAD account to my GBP home account means I can cash in on the exchange move without having a Canadian bank account.
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Re: Exchange rate
Originally Posted by Southcote
(Post 6665003)
We need to close on our house in Canada by 25th September, so we have a few weeks to play with. Do you have any suggestions ?
Hope that helps. Chris |
Re: Exchange rate
Originally Posted by cneldred
(Post 6666892)
Things will liven up after the Labour Day holiday at the start of September, that is when most traders will return to their desks (myself included). I don't expect too much to happen before then, but if you see a clear move one direction or the other after that date then that sets the tone for the next move.
Hope that helps. Chris |
Re: Exchange rate
Chris |
Re: Exchange rate
Aaargh .... sterling meltdown..... aaargh!!!
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Re: Exchange rate
Originally Posted by geedee
(Post 6676502)
Aaargh .... sterling meltdown..... aaargh!!!
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Re: Exchange rate
It will pick back up it was a bad day today and much of the loss happened in the first few hours. If oil prices continue to fall (perhaps the pipe in georgia will be reopened now that we have a ceasfire) then the cad will follow. Keep your fingers crossed.
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Re: Exchange rate
Just out of curiosity, if someone were taking a short to medium term (6-24 month), might it not be a good idea to buy the USA $ now, seeing that its still good value, hopefully making some gains along the way, then going for CAN $ ?
M. |
Re: Exchange rate
But the USD isn't in the best condition ether also if the cad drops it is normally in part due to the US not buying oil from the north which is normally due to people not using as much gas as they try to save money which can be due to inflation. So if the USD declines then the CAD could too against the doller anyway. GBP isn't as directly tied with CAD so the weak situation described above would have an improvement for gbp against the cad but you are then holding usd does that make sense to anyone but me as it could have just been rabble? :)
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Re: Exchange rate
whats going on the the $CAD then :curse: after seeing it get up to 2.051 we were getting excited, hope it picks up a bit :thumbup:
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