Morning Note: Carney Becomes Canada’s PM, China CPI Drops, and Oracle Earnings Loom

Carney Wins Liberal Leadership, Faces Trade Challenges Ahead

Former central bank governor Mark Carney has claimed victory in the leadership race of
Canada’s ruling Liberal Party and will be replacing Justin Trudeau as the Prime Minister, according to the official results released on Sunday. Carney garnered 86% of the votes in a primary election where almost 152,000 party members came out to vote, thus beating out former Finance Minister Chrystia Freeland.

Although new to politics, Carney presented himself as the most experienced figure to restore the party’s image. He also aimed to handle sensitive trade negotiations with Trump, who has previously boasted about imposing additional tariffs, which could cripple Canada’s export-driven economy.

(USD/CAD Daily Chart, Source: Trading View)

From a technical analysis perspective, the overall trend of the USD/CAD currency pair has been bullish since the beginning of October 2024, as indicated by the formation of higher highs and higher lows. However, strong bearish momentum pushed the rate downward at the start of February 2025, and the candlestick pattern has begun to shift to a bearish structure, as evidenced by the lower high pattern formed in March 2025.

Recently, it was able to close above the swap zone of 1.4300 – 1.4340 to end last week. However, if it fails to form a higher high price action pattern and experiences a solid break below this swap zone once again, the bearish momentum could drive the rate further downward to retest the support zone between 1.4120 and 1.4170.

China’s Inflation Falls Sharply

In February, China's consumer price index (CPI) fell more than anticipated, marking its largest drop in 13 months. This was due to declining seasonal demand and cautious household spending due to employment and income concerns. According to a survey conducted by NBS, China’s National Bureau of Statistics, the overall CPI for February dropped 0.7% over the previous year, with January witnessing a 0.5% increase.

Additionally, the month-on-month CPI for February also witnessed a decline of 0.2%, following January’s 0.7% increase in CPI. Core CPI, which excludes the more volatile food and energy sectors, also dropped by 0.1% in February compared to January. This was the first decline in core CPI since January 2021.

(China A50 Index Daily Chart, Source: Trading View)

From a technical analysis perspective, the China A50 index has been moving within a descending channel since mid-October 2024, as indicated by the lower highs and lower lows within the channel. Recently, it encountered a resistance zone at 13,400–13,500 and was rejected, pushing the price downward. If it fails to break above this resistance zone in the near term, it is highly likely to retest the support zone below at 12,600–12,700. Conversely, if it manages to break above the resistance zone, it may surge upward to challenge the upper boundary of the descending channel.

Investors Eye Oracle's Earnings Report

Oracle is scheduled to release its third-quarter fiscal year 2025 earnings report on March 10 at 22:00 GMT. The company is expected to report earnings of $1.48 per share on revenues of $14.36 billion, reflecting year-over-year increases of 5% and 8.1%, respectively. While these estimates have remained stable over the past month, they have declined compared to levels from two and three months ago. This is because Oracle has emerged as a significant player in the AI sector, contributing to the stock's recent underperformance.

(Oracle Shares Price Daily Chart, Source: Trading View)

From a technical analysis perspective, the recent price action has broken below the ascending channel at the beginning of March and is now retesting the swap zone of 151 – 154. If this swap zone fails to hold, the price may continue dropping further, retesting the support zone below at 137 – 140. Conversely, if the price finds support at the swap zone, it may continue surging upwards and maintain its bullish wave movement.

When considering shares, indices, forex (foreign exchange) and commodities for trading and price predictions, remember that trading CFDs involves a significant degree of risk and could result in capital loss.

Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be construed to be investment advice.