WTI made the bounce off the 200-week M/A two weeks ago, and we’ve seen a decent recovery from those lower levels, despite closing below the 200-day M/A for two consecutive days.
But trading Oil without looking at $CAD means you’re only looking at half the picture.
These two markets correlate very closely. As Oil rises, the Canadian Dollar tends to strengthen — which means USD/CAD tends to fall.
On USD/CAD, there are two important levels to watch this week:
- 200-day M/A — 1.3852.
- 200-week M/A — 1.3734.
Both could prove significant.
Meanwhile, WTI has formed a small bullish flag on the Daily chart, which gives a broader technical target around 95.50.
Before we start looking that far ahead, though, the initial upside levels are:
I would expect some profit-taking around this area, but I’ll still be keeping 95.50 firmly on the radar further down the line.
Today’s WTI Pivot Point: 82.03.
Yes, we’re in Summer markets — but Oil can still move.
For me, the overall technical picture remains:
Buy Oil on dips.
Sell USD/CAD — if not here, then on rallies/pullbacks or following a close below the 200-day M/A.
Watch the charts. But just as importantly, watch the relationships between the markets.
This is not to be construed as investment advice.
About The Author
