After 3 years, GBPCAD hit the major support area. Since 2018, GBPCAD hit the resistance area continuously every year in March month. But this year 2022, GBPCAD hit the major support area. For the last 7 years (2016 to 2022), GBPCAD is moving only between these support and resistance areas.
In February 2022, we have given the Sell signal on GBPCAD at the high level of the important zone. now the market fell 14,000 points from the highs to the lows.
Let’s see why GBPCAD is moving between this support, resistance ranges for the last 7 years?
January 2017
In January 2017, the GBPCAD currency pair faced a sharp decline to support levels of about 1.59402. Here are a few major events that caused this to happen:
Trump Presidency
Another major event that occurred in January 2017 is when Trump was elected as the President of the United States. He got the majority votes and was elected despite mixed feelings from the people of both the States and Canada. This saw a positive change in the value of the CAD which caused GBPCAD to depreciate.
Canada Employment Change
One of the major factors contributing to the drop in the GBPCAD market value is the Canada Employment Change report that was released earlier in January 2017. This is a measure of the change in the number of people employed in the country. The change in the number of people employed in January was 53.7K which shows an increase in the number of people employed.This is bullish for the CAD but caused the GBPCAD to drop in value.
March 2018
In March 2018, the GBPCAD currency pair faced a sharp increase to resistance levels of about 1.78972. Here are a few major events that caused this to happen:
Canada Account Deficit
In March 2018, it was revealed that Canada had a trade deficit in its account of roughly $44.1 billion. This was mainly due to the fact that Canada had a trade spending problem. The number of products they were importing was significantly more than what they were exporting. Their main imports included petroleum products like crude oil and natural gas.
NAFTA Deal
One of the major contributing factors to the drop in the value of the CAD which caused GBPCAD to see a sharp incline was the NAFTA deal that was ongoing between the US, Canada, and Mexico. This was a deal to open up trade between the countries but Canada was not satisfied with the terms of the deal. The US was pushing to close the deal but Canada was uncertain about it.
August 2019
In August 2019, the GBPCAD currency pair faced a sharp decline to support levels of about 1.59402. Here are a few major events that caused this to happen:
Canada Inflation
August 2019 was a difficult time for Canadian citizens as they faced a massive inflation problem which caused a surge in prices for everyday necessities.
Fuel costs saw a sharp increase and the housing industry became unaffordable for many. The Bank of Canada was doubling down on its interest rates in order to combat this crisis. This caused the CAD to see bullish market conditions which caused the GBPCAD to fall in value.
Brexit Concerns
Ever since the UK voted to leave the EU in 2016, the GBP has faced a sharp increase in its market value. As Brexit is almost approaching, the GBP is at one of its best periods in history. Due to these positive market conditions for the GBP, the GBPCAD has also appreciated in market value.
March 2020
In March 2020, the GBPCAD currency pair faced a sharp increase to resistance levels of about 1.78972. Here are a few major events that caused this to happen:
UK Herd Immunity
By March 2020, it has already been a few months since the coronavirus was discovered. The UK is one of the few countries that has yet to take this virus seriously.
While all the other countries are beginning to impose lockdowns that are impacting businesses, the UK is all set to fight the virus through herd immunity. This is why their economy wasn’t impacted yet which caused the GBP to be one of the few currencies that didn’t face a decline.
Canada Travel Ban
Canada was one of the few countries that had faced the brunt of the pandemic impact early on. They faced a surge of cases right when this entire ordeal began which caused them to take measures much earlier than most countries. Canadian President Trudeau had just announced a travel ban on non-Canadian citizens in March 2020. This depreciated the CAD and caused GBPCAD to increase in value.
March 2021
In March 2020, the GBPCAD currency pair faced a sharp increase to resistance levels of about 1.78972. Here are a few major events that caused this to happen:
UK Nuclear Power
In March 2021, the UK revealed its plans to increase its production and supply of nuclear energy resources and weapons. They declared that they were going to tighten their nuclear policies in order to make it more accepting of this major military weapon. They claim that these are just precautionary measures in case they needed to use them later. This increase in nuclear weapons had caused the GBP to also appreciate which caused GBPCAD to increase in value.
Canada Vaccine Suspension
This was a time when the COVID vaccines were being rolled out and provided in full force. Despite this Canada had just suspended the use of the AstraZeneca vaccines in the under 55 age category due to growing concerns about its harmful side effects. Due to this, the CAD faced a drop in its market value which caused GBPCAD to trend upwards to resistance levels.
April 2022
In April 2020, the GBPCAD currency pair faced a sharp decline to support levels of about 1.59402. Here are a few major events that caused this to happen:
Ukraine-Russia War
By April 2022, the war crimes occurring in Ukraine by Russia are still in full force and are showing no signs of ending any time soon. This has been a difficult period for the UK as they’re facing supply chain shortages as a result of this war. Crude oil has become really expensive and in short supply. This has caused the GBPCAD to fall to support levels.
Canada Unemployment Drop
For the first time since the pandemic began, the Canadian economy is finally improving as April 2022 noted a record number of job increases which caused the unemployment rate to drop significantly. The Canadian government added 72,500 new jobs which caused the unemployment rate to drop to 5.3%. This caused the value of the CAD to appreciate which caused GBPCAD to fall to support levels.
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