GBPCAD Daily Outlook The GBPCAD currency pair is showing a new uptrend and has lost 5% over the past six trading sessions. The pair is currently trading in a relatively narrow range, oscillating between the 20-day simple moving average and the 50-day simple moving average, with some consolidation in the overall uptrend. The recent rise in the value of the British pound was driven by the Bank of Canada’s accommodative monetary policy and ongoing global uncertainty around trade policy, particularly as a result of US President Trump’s ongoing tariff measures. The Bank of Canada decided to keep its key interest rate unchanged at 2.75% on Wednesday, as markets had expected. This follows seven consecutive rate cuts over several months. Governor McCallum explained that inflationary pressures remain, and policymakers are increasingly concerned about the spillover effects of the US tariff regime. He warned that many companies are raising prices and slowing down investment and making hiring decisions ahead of the tariffs as they adjust to the expected supply chain disruption. There was a time when market sentiment among traders was very high. Technically, the picture is a bit difficult to understand. The relative strength index (RSI) is usually at a neutral level of 50. It is moving towards a certain level and there is currently no strong or weak momentum. Meanwhile, the stochastic indicator has started to move above its signal line, which could be a sign that the strength of the short-term bull market is weakening and a consolidation phase has begun. Complicating expectations. The indicator is still in the negative zone, but is trying to break the signal line. If the bullish sentiment strengthens, GBP/CAD could face an initial test near the 20-day simple moving average at 1.8369. Since it coincides with a key turning point in the past market, it is likely to act as strong resistance. Meanwhile, if the Canadian dollar manages to gain fresh momentum (perhaps aided by improved risk appetite or higher commodity prices), the GBP/CAD pair could initially come under pressure around the 50-day simple moving average at 1.8333. The level has been exposed, but this level has seen some stability in the past. It is technically important because it includes the 50% Fibonacci retracement of the January-March uptrend, which is similar to a moving average, forming a strong support level that could prevent further declines and trigger a strong reaction. Overall, the short-term outlook for the GBP/CAD pair is somewhat bullish, with recent gains driven by the Bank of Canada’s interest rate cuts and the relative strength of the British pound. While a decisive break above a resistance level would be supportive, a stronger Canadian dollar or further deterioration in global risk sentiment could increase downside risks.
