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July 24, 2018 | USD/CAD Short Trade Setup

Jack has over 20 years experience in the currency, equity, and futures arena. He is an investment advisor who has held key positions in brokerage, money management, trading, and research. Jack is founder and president of Black Swan Capital LLC. He was also founder of Ross International Asset Management (specializing in global stock, bond, and currency asset management for retail clients) and General Manager of Plexus Trading (specializing in currency futures and commodities trading).

USD/CAD Daily View [last 1.3133]: I am looking for minor Wave-[c] to carry down to at least 1.2968, but prefer the Alternative count to 1.2851–a 61.8% retracement of Wave-A. Key support comes in at 1.3106. Bank of Canada rate hike expectations are rising on the back of last week’s inflation report.  And that is showing up in the 2-year yield spread comparing CA-US (next chart below).  Additionally, position in CAD is bearish; thus plenty of buying power on a re-think there (third chart below).

072318 cad daily.png

The 2-year yield spread CA-US is rising in favor of Canada of late…

072318 cad us spread.png

Canadian dollar (CAD-USD) currency futures positioning CME…lots of bears; if they change sides it represents some nice buying power for the Loonie.

072618 cad cme pos.png

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July 24th, 2018

Posted In: Black Swan Currency Currents

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