USDCAD isn’t a pair you want to short right now

  • Arguments with the Saudi’s, leading to stories that the Saudi’s are dumping CAD assets “no matter what the cost”
  • NAFTA/trade agreements a million miles away
  • A more neutral BOC
  • Worsening CAD data
  • Disconnection with oil right now

It begs the question who would want to be long CAD right now?

Technically, we’re in a bit of no-man’s land here. The nearest decent looking level is around 1.3220, which would also match up with a falling June channel top (not on chart).

USDCAD daily chart

USDCAD daily chart

Of course, all this could turn around on some good headlines but until that happens, things aren’t looking to rosy for the syrup swiggers.

A dip to the 50 fib and 100 DMA around 1.2955 looks juicy for a long, and that 1.3220 level could be worth watching for a short. In either case, we’ll have to assess the reasons why the price has gone there.

Ryan Littlestone

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