AUD-CAD trade cross is known to be an interesting pair. This is because it has several particulars that cannot be found in any other pair. This cross is commonly referred to as commodity cross since the trade involves two diverse currencies affected by commodity prices CAD and AUD. Even if a trader in South Africa does not know how to trade AUD-CAD pair, it is imperative to understand that this is one of the best pairs that one can trade in. A binary options South African trader can make great profits from this pair in addition to the exciting features that are found therein. A commodity currency, as IQ Option will say, is one that is influenced greatly by changes in commodity prices. For instance, since South Africa is a renowned gold producer, South African rand is very sensitive to changes in global prices of gold.
The commodity markets greatly influence the Australian dollar. A simple trigger on market price makes the dollar to move. Before a trader in South Africa starts getting involved in any AUD pair, it is critically important to understand the situation of the Chinese economy so as to be sure of how to trade AUD-CAD. The Chinese economy is responsible for almost 30% of the Australian exports. To put it in another way, if China reduces the intake of Australian goods, the Australian dollar would be slow. The converse is also true. A great demand for Australian goods in China makes the Australian dollar strong.
South African traders should note that AUD-CAD trade pays a positive swap. A trader who finds interest in the carry trade is said to be the driver of the trade. A positive swap is used to mean that the longs in each pair get an interest for every trading day. The longs could also receive a swap that corresponds with the amount committed to the trade.
- Prices of commodities
- The meetings and minutes of the Reserve Bank of Australia (RBA)
- The Consumer Price Index (CPI) and inflation report for Australia. This is followed by the central bank.
- GDP growth of the Chinese economy and any other reports that relate to the performance of the Chinese economy.
Traders in South Africa should be aware that the Canadian dollar relies heavily on global oil prices. Although such economic facts may seem complex for beginners, IQ Option breaks them down into simpler forms so that a trader can know how to trade AUD-CAD. It is always important to be on the lookout for the minutes of OPEC meetings and other reports for oil inventories in the US.
A South African trader should closely monitor the Chinese market so as to be sure of the price of gold, copper and silver among other metals. The Purchasing Manager Index (PMI), whose report is given separately is also vital. If the figure of the PMI is above 50, it is an indication of a strong market. A figure below 50 is a negative indication, and hence a trader should avoid trading the AUD-CAD pair. The Australian GDP growth and employment data are also important. The Reserve Bank of Australia however, has the strongest influence on the Australian dollar.