USD/CAD: Short-Term Profit Taken, Stay Bearish In The Long Term

FX:USDCAD   U.S. Dollar / Canadian Dollar
The commodity-linked Canadian dollar is strengthening today on rising oil prices. Led by top crude exporter Saudi Arabia, the Organization of the Petroleum Exporting Countries (OPEC), has re-launched a debate about oil producers potentially capping soaring output in an effort to reduce a global overhang in production and storage of crude oil and refined fuel products.
What’s more, Venezuela, which holds the world's largest crude oil reserves, is on track to suffer its steepest annual oil output drop in 14 years as it struggles with an economic and political crisis and years of underinvestment and mismanagement. In the 12 months to June, Venezuela's crude output fell 9% to 2.36 million barrels per day. Concerns over oil production in Venezuela were also impacting markets.
Sales of existing Canadian homes fell for the third month in a row in July, data showed on Monday. Seasonally-adjusted home sales declined 1.3% in July from June. Sales were down in just over half of all markets last month, led by the Greater Vancouver area and the Fraser Valley in British Columbia. Sales in the two regions have tumbled by 21.5% and 28.8% respectively since peaking in February. Canada's housing market has run hot in the years since the global financial crisis, supported in part by cheap borrowing costs. But the market has become fragmented with activity in regions with economies dependent on the oil business slowing as the major cities of Toronto and Vancouver accelerate. Vancouver earlier this month imposed a tax on purchases of homes by foreign buyers to try to make the market more affordable for locals and to alleviate concerns that its market is becoming overheated.
Canadian macroeonomic data, including retail sales for June and inflation for July, will both be released on Friday.
We took profit on our short-term USD/CAD position at 1.2900. We keep our bearish long-term outlook - Daily Forex Signals
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