FOMC and Oil. That double whammy was too much for the Cando in today's session as the currency broke down into a fresh ELEVEN YEAR LOW. Though it too did manage to bounce off the session lows as the US Dollar experienced a round of selling pressure, the Cando still ended the day lower. Currently in Asian trade, it is trading lower again.

Canadian Dollar Monthly Chart

As of yet, the currency shows no sign of halting the steep decline that has been ongoing since early 2011. Based on the long term chart, there looks to be some psychological downside support just above the .70 level. If the unit failed to hold there, it is not a stretch of the imagination to expect it to visit the .66 level or even lower.

Looking in a bit closer at the Weekly chart, you can see that the bears still have control of this market with the currency on course for another poor finish to end the week.

Canadian Dollar Weekly Chart

I have said it many times here - the fortunes of the Canadian Dollar are tied directly to the fortunes of the broad commodity sector and even more directly to the price of crude oil. As long as oil remains weak, expect the Cando to remain weak as well.

There have not been a lot of markets that have exhibited well behaved trending moves. This currency has been the exception with a solid downtrend in place and moves higher being of short duration. Must be Manipulation Eh?

Dan Norcini

http://traderdan.com

Dan Norcini is a professional off-the-floor commodities trader bringing more than 25 years experience in the markets to provide a trader's insight and commentary on the day's price action. His editorial contributions and supporting technical analysis charts cover a broad range of tradable entities including the precious metals and foreign exchange markets as well as the broader commodity world including the grain and livestock markets. He is a frequent contributor to both Reuters and Dow Jones as a market analyst for the livestock sector and can be on occasion be found as a source in the Wall Street Journal's commodities section. Trader Dan has also been a regular contributor in the past at Jim Sinclair's JS Mineset and King News World as well as may other Precious Metals oriented websites.

All ideas, opinions, and/or forecasts, expressed or implied herein, are for informational purposes only and should not be construed as a recommendation to invest, trade, and/or speculate in the markets. Any investments, trades, and/or speculations made in light of the ideas, opinions, and/or forecasts, expressed or implied herein, are committed at your own risk, financial or otherwise. The information on this site has been prepared without regard to any particular investor’s investment objectives, financial situation, and needs. Accordingly, investors should not act on any information on this site without obtaining specific advice from their financial advisor. Past performance is no guarantee of future results.

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