Mind the CAD While the OPEC Soap Opera Carries On
Yesterday we posted an update where we advised you guys to be careful with the CAD pairs since the OPEC meeting is taking place in Vienna. I thought that the meeting was only a one day programme with the possibility of another day extension, as is usually the case with OPEC countries when they try to agree on something, anything.
The meeting is still alive today and I just saw somewhere that another meeting will be held on the 30th of November. Surveys show that most of the respondents (not sure of the target) think that a deal will be reached, but oil prices are having some difficulties.
Even if an agreement is reached about freezing or cutting oil production, it won´t assure the market that the oversupply will end. The production cuts need to be substantial in order to balance the demand and supply, but OPEC countries are what they are, weak and non-diversified economies totally dependent on oil revenue. Therefore, no one knows how far they will go.
Meanwhile, Russia is disappointed that they haven´t been invited to the next meeting on November 30th. I had no idea about this meeting; I thought everything was going to end today at the latest. But the drama continues and the signs are not that positive. So guys, I stress again, be careful with the CAD pairs, especially USD/CAD because just when you think OPEC has wrapped things up, which would be positive for the CAD, another basket case steps in and starts everything from the beginning, which would normally sink the Loonie.
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