- A solid rebound into late July for oil (Brent and WTI), switching the intermediate term outlook from neutral back to bullish.
- Moreover, the bullish move in oil has reinforced and sustained the intermediate-term bearish trend for USDCAD, which we look to extend into August.
ICE Brent Future – Intermediate-term bull shift and upside risks
September 2017 Contract
A significant rally on Friday, reinforcing the push last week above 49.90 and important resistance of 51.01, keeping risk higher again Monday.
Furthermore, our intermediate term outlook has shifted to bullish.
l We see an upside bias through 52.68; break here aims for a key level at 53.19, then maybe towards 53.95.
l But below 51.90 opens risk down to 51.31.
Intermediate-term Outlook – Upside Risks:
l We see a positive tone with the bullish threat to 51.01, 53.19 and towards 55.14.
What Changes This? Below 47.18 signals a neutral tone, only shifting negative below 46.11.
USDCAD – Bearish threat
A short-lived correction at the end of last week with the Thursday rebound above minor resistances quickly rejected with a plunge back lower on Friday, resurrecting the downside threat into Monday.
Furthermore, the June push below 1.3219 signalled an intermediate-term bearish shift, which is very much intact.
l We see a downside bias for 1.2411/05; break here aims for 1.2355, may be closer to a better support at 1.2304.
l But above 1.2500 opens risk up to 1.2576.
Intermediate-term Outlook – Downside Risks:
l We see a negative tone with the bearish threat to targets 1.2127, 1.2000 and 1.1919.
What Changes This? Above 1.3015 signals a neutral tone, only shifting positive above 1.3347.