Falling Crude Prices Help Boost USD CAD

Another session of selling pressure in the crudeoil market helped weaken the Canadian Dollar, sending the U.S. Dollar slightlyhigher against the Loonie.

Another session of selling pressure in the crude oil markethelped weaken the Canadian Dollar, sending the U.S. Dollar slightly higheragainst the Loonie. Today’s trading session also had a “risk off” theme whichtriggered some light shedding of higher risk assets, contributing to theCanadian Dollar’s weaker tone.

Technically, following a recent sharp sell-off, the USD CADformed a daily closing price reversal bottom which was confirmed on September15. The lack of follow-through to the upside is helping to prevent this marketfrom finishing its counter-trend retracement to 1.0361.

Overall, there are concerns the Canadian economy is slowingdown. Lower crude oil is hurting exports, but the weaker U.S. economy may be having a biggerinfluence on the Canadian economy than estimated earlier. Some traders aresaying that the Bank of Canada’s recent rate hike may do more harm than goodfor the economy.

James A. Hyerczyk has been actively involved in the futures markets since 1982. He has worked in various capacities within the futures industry from technical analyst to commodity trading advisor. Using W. D. Gann Theory as his core methodology, Mr. Hyerczyk incorporates combinations of pattern, price and time to develop his daily, weekly and monthly analysis. His firm, J.A.H. Research and Trading publishes The Forex Pattern Price Time Report... More