USDCAD & USOIL Correlation Trading
This morning we were very bias to a USOil fade from the buy line to the downside. Trading short off the 48.10 had me watching the USDCAD market for a possible break to the upside. The dollar index found some minor support at its sell line which was threatening both the CAD and USOil trades. It wasn’t until the DX decided to rip through the sell line and then get huge buying support at 94.45. It had a direct affect on the USDCAD which captured a bid for a great break of it’s buy line which sellers were trying to still absorb the demand. To bad sellers! USDCAD went to target shortly after the break.
We caught some big heat in the CAD trade but the method and it’s stop placement kept us in for a nice win. Same for USOil as it’s pullback failure with correct stop placement it later exceeded a 50 tick in favor trade.