USD/CAD continues to trade in a 280 point descending channel breaking below the 50% mark yesterday. This morning the chart indicates the pair was rather uncomfortable testing the $1.070 level and I believe this sets up a decent range trading opportunity to test the lower ranges of the channel again.

The fundamental picture for USD/CAD is evenly matched so I don’t expect any huge breakouts over the next day or so. Friday we will see Canada’s employment figures for April, should they surprise to the upside that may give this pair some bearish strength.

I think the continuing question will be “How weak is the Dollar?” rather than “How strong is the Loonie?” This morning’s housing report didn’t surprise us at all but oil inventories were on the upside considerably.

Either way I still think this is a decent short; my stops are above $1.080.

Note: The comment on my screen shot should read “Wait for a break below minor support” instead of “resistance”.

Good luck,

Ryan