The gap higher in USD/CAD combined with the break of parity on Sept. 11 sparked a shift in USD/CAD sentiment. Oil continues to fail around $90 and with the macro environment deteriorating, the pair may break out.
Last week’s Commitment of Traders report showed a shift into a net short CAD position – a bearish indictor. Similar shifts preceded the recent breakdowns in EUR and GBP.
The 10-minute chart has built a nice sequence of higher lows and higher highs. A break above 0.9950 is likely to send the pair back to the recent highs.
