There is a nice potential short trade here with USDCAD. On the chart, the green line is a LT downtrend resistance, here coupled with a possible double top (horizontal red line) formation. Add to that a break-out of the medium term uptrend. The RSI has finally broken out of its divergence wedge pattern to the downside giving us confirmation.
Sentiment wise, the COT data shows a halt in short/selling in forward contracts by large speculators, this could ignite further selling. Crude oil rallied today, Gold is up as well, proving weakness in dollar and strength in commodities (GSCI index up 2.68% today). Put premiums on USDCAD are still lower than Call premiums and we have seen barely any change today but I wouldn’t be surprised to see a supportive risk reversal in the coming days. All in all, the Loonie looks strong in the medium term!