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USD/CAD Chomping Through Offers

|Includes: CurrencyShares Canadian Dollar Trust ETF (FXC)

USD/CAD (NYSEARCA:FXC) is testing the 1.0157 session high after a slide to 1.0125 at the bottom of the hour. Corporate accounts are on the offer so it will be slow going on a move upward.

I see considerable upside in this pair as the Bank of Canada back away from rate hikes due to slowdowns in Europe and China that will spillover to commodity prices. Cracks are also showing in the Canadian real estate market.

On the weekly chart, the long-term trendline from the 2009 highs has given out and the range has definitively broken to the upside.

An initial target is 1.04 with a test of 1.06 likely. The risk is that a relief rally hits US stocks but that will ultimately provide better levels for USD/CAD longs.