USD/CAD ANALYSIS

OPTION:

Vols. moved higher again today with interest seen across the whole curve. 1 month traded at 7.1% ending the day at 7.2/7.4%. 2 month traded at 6.75%, also closing better bid, and 1 year was paid at 6.5% on the close. 15 day 1.0750’s traded at 7.55%, 2 week 1.08’s at 7.45%, and 1 week 1.0735 at 7.5%. Monday 1.0725s traded at 6.3% and overnights remained fairly steady throughout the day trading at 9.5% on the close.
Strikes for tomorrow 1.0700 1.0725 1.0740 1.0750

PROGNOSIS:
Mixed sentiment for Canada from this writer with Canada closing within our stubborn consolidation channel but closing above the downward channel from 1.18 highs. With markets generally unable to sustain breaks of any significance in almost everything recently why should Canada be any different? We look to trade from a modest short USD position looking to add on a minor rally to 1.0760 with a tight stop above 1.0780 looking for a dip back to 1.0705 to take profit.