by Clive Maund
CliveMaund.com
As a Brit I well understand the deep admiration the Canadians have for their powerful neighbors south of the border, even if it is not always expressed. The good news in this update is that now is the time to “put your money where your mouth is” when it comes to admiring the Yanks, by changing your Canadian dollars immediately into US dollars, the prime reason being that the Canadian looks set to drop after a big rally from mid-January, while the US dollar looks set to surprise by rallying away from the danger zone of the support around 93 on the dollar index.
Conventional wisdom has it that the dollar is now doomed because the Fed has just chickened out of raising rates again, but what the market is overlooking is that the Fed can blow hot and cold on interest rates anytime they like, and since the market hangs sycophantically on their every word, only words are required, not actions.