U.S Dollar/Canadian Dollar Outlook
The Canadian dollar continues to maintan its dominance over the U.S. dollar. We have consistantly seen the .99 level tested time and time again with out any follow through. I have included a link to a weekly chart to offer a bigger picture perspective on the USD/CAD trend. Using a common exponential moving average pairing of 8 and 21, we can see that the trend in force remains to the downside. This makes the support level I have highlighted at .98/.99 zone very important for the U.S collar bulls. A follow through to the down side could see the pair trading all the down to at the .90/.93 level. We haven’t seen those levels since oil was at $100.00/barrel. With oil continuing to test…and reject the $94.00 resistance, we have seen the USD/CAD conversely bounce off of the .98/.99 support. As Richard observed in his last blog…Oil is due for a correction, however a break beyond $94.00 and a push towards $100.00 is likely going to further weaken the U.S. Dollar towards the .90/.93 lows of 2007.
USD/CAD WEEKLY CHART
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Jason is CEO and Director of Business Development at R N Croft Financial Group, a member of the Croft Investment Review Committee and a Derivative Market Specialist by designation. In addition, he is an educational consultant for Learn-To-Trade.com and an instructor for the TMX Montreal Exchange.
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