If you look at the oil prices and the AUD/CAD rates, you can see a lot of common things, most notably the huge impact of oil values on the CAD. After oil began to decrease an upward trend in favor of the Australian dollar was formed, despite the fact that the Australian economy is becoming less attractive to investors, and the macroeconomic statistics are not impressive in their performance. Despite the signs of recovery for oil prices and the deviation from yearly lows, there is a probability for a further decreasing in oil prices. At the moment investors expect the results of the key meeting of OPEC, which will take place in a week. At the upcoming meeting of the leading oil exporting countries key issues regarding the redistribution of quotas will be discussed. It is also possible to suspend the oil reduction agreement, considering the more stable situation on the market. Still, some analysts suppose that this issue will be postponed because a number of market participants would like to see the recovery of the oil price above $80. On the other hand, we can hardly expect a significant increase in oil production because countries such as Venezuela, Mexico, Iran, and Iraq simply cannot increase oil production due to sanctions or lack of funding.
The news background for the AUD/CAD was not saturated this week. Investors were mainly focused on the situation in the US, Japan and the EU, where Central banks took their decisions on monetary policy for the near future. Unemployment data released this week in Australia supported the growth of the AUD. The unemployment rate fell to 5.4% in May, the lowest level in the last six months. Furthermore, consumer sentiment has been improving - up to 102 points, which indicates an overall increase of optimism on the market. At the same time, the slowdown in the growth of industrial production in China is pressuring the AUD rate. As for CAD, the value of this currency has changed only under the influence of external factors. The situation is likely to change in a week with the release of important indicators for the economy of Canada - the consumer price index in May and data on retail sales volumes. Thus, the volatility will increase sharply in a week, with the release of new statistics and news from the OPEC meeting.
At the moment, the MACD and Stochastic oscillators signal the efficiency of the deals to BUY, which can still be effective in the short term.
