Today is Sun, October 15, 2017 3:35:52 GMT
RSS Follow Us Follow us on Twitter Friend us on Facebook
Currencies CAD USD/CAD (Loonie) Approaching Resistance!

Lost in the shuffle of the risk themes in the forex market due to the Euro debt crisis, the Canadian dollar has been weakening despite some fairly positive economic news.  While the US dollar has been strengthening vs. the Euro, the data in the US has been largely positive which bodes well for US demand.

This could help Canada immensely, as the US is the largest importer of Canadian goods.  But one of the unique features of the Loonie is that it maintains a tight correlation with the price of oil, as the US is the largest importer of Canadian oil.  So as the price of oil has been retreating due to global risk aversion, an improving US economy could lift demand for black gold.

If the risk trade increases into the end of the year, then global stocks and commodities would move higher with the US dollar weakening.

I’m looking to sell USD/CAD as it moves closer to 1.04, with a stop just above the recent highs at 1.0425.