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currency trading
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Tips For Canadian Currency Trading
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Canadian currency trading is well known on the Forex market because of its image as a growth-tied currency. The Canadian dollar, which is also known as the "loonie," swings in line with the dictates of the market.

So, if you invest in the Loonie when the economy is bearish, you could be smiling to the banks with high yield returns. The Canadian currency trading is mostly against the US dollar. But that is not to say that it does not pair versus the Euro and Australian dollar.

Let me take you down the memory lane about the existence of the Canadian currency trading. Until the Canadian dollar's peg to the US dollar was abolished in the year 1950, the first ever Canadian currency trading was not on track. Prior to this period, the Canadian dollar was pegged at a fixed rate of 90.91 US cents. After the end of the fixed rate system, the Canadian dollar was traded against its US counterpart at a premium. It waxed stronger, managing to reach $1.06 in 1957. But, the loonie was pegged again to the Greenback in 1962, only to be floated afterwards, 8 years later, as a result of inflationary issues.

Being able to succeed in Canadian currency trading can be determined by being able to analyze the key indicators. The most crucial factor you need to bear in mind about Canadian currency trading is to; take note of the economic conditions in the US. You will understand this well if you know that Canada shares a close trade relationship with the US. As a result, any factor that impacts on economy of the US will affect where Canadian currency trading swings to.

In addition, you need to pay close attention to the fact that crude oil prices account for as much as 50% of Canada's exports. Due to this factor, declining oil prices will negatively affect the loonie. On the other hand, appreciating oil prices will boost the Canadian currency.

What about the sovereign currency rating? This tells you the stability and overall growth of the global markets. A poor rating will most likely limit the availability of the loonie in the global capital market. As you may have presumed, this will affect the Canadian currency trading rate.

Finally, you should never forget to review the Bank of Canada's statements and announcements as carefully as possible if you want to gain on Canadian currency trading. The apex bank regulates the availability of the currency to keep inflation in check. So, open your mind to the facts if you want to succeed in Canadian currency trading.


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