USDCAD daily chart

Oil prices are down more than $4 today but the loonie is keeping pace with the US dollar.

USD/CAD is flat at 1.2919. The high last week was 1.3079, which basically matches the May high and threatens a double top.

The loonie has held up well this year in large part due to oil and natural gas. Terms of trade for Canada going ahead look strong but a deeply overvalued housing market poses a significant risk.

Today, Canada CPI rose to the highest since 1983 in a report that CIBC said makes a 75 bps hike to 2.25% a 'near certainty', according to CIBC.

The turn in the loonie coincides with the CPI and bounce in oil to $105.75 from a low of 101.53 but also with broad weakening in the US dollar. Fed chair Powell has warned about weakening US demand today and there's a flight to bonds, which could be weighing on the dollar.

Overall, that double top is worth watching alongside energy. The loonie is the second-best performing global currency this year and there are signs demand is holding up. The housing market is a big risk and I think the top of this breaks but today's price action is decent.