This slump in in general is what is causing CAD and AUS weakness. I still have a USDCAD short idea that was posted maybe a week early. It is also interesting to see equity markets booming and not for the first time I am raising concerns of US stocks in particular, in my ideas I have stated this but also mentioned that we are in the middle of Q1 reporting season and in one of my ideas I predicted that results are expected to be good and they are. This relates to the VIX ( index) you will see its at historic low levels dating back to 2007 before the 2008 crash. I am not predicting a crash by any means. Just note that the VIX and commodity prices share some correlation.
In my opinion, Oil is a smart buy at the moment. OPEC have relaxed some of their production restrictions in the short-term allowing countries outside of the production regime more time to get back into line. This however is not a situation that OPEC would allow indefinitely. The next OPEC meeting is 25 May and eyes will be on this event to see what measures will be introduced, it is abundantly clear that pump at will policies will not be entertained.
Looking towards the US and Baker Hughes data, american producers are now at their highest level in 2 years. However traditionally there is higher oil demand for the Northern hemisphere winter and the question is how this will all balance out.
My modest prediction is that in general are at improved buy levels and Oil as well. The VIX also has reached the bottom of its curve and can only trend up. OPEC will be very concerned about the decline in prices and the 25 May meeting will be a tough one as there is danger of breaking the upward trend since early 2016. OPEC vs non-OPEC production will level off and even on the US side production will decline as marginal oil rigs cant be sustained if the price slides further downwards and H2 2017 demand will see a moderate rise in price.