Day Trading Oil and the USDCAD 5-09-2016

We recently took a swing trade on the USDCAD in our Forex Trading Signal service.

I often get asked why I look at OIL when I trade the USDCAD. The reason is simple, OIL is the main driver of the pair USDCAD. The Canadian economy is reliant more on OIL than any other single element for revenue, so it's  important to keep in mind when trading the USD/CAD. I will often draw major support and resistance lines on OIL and try and get an idea where the USD/CAD may find support then compare the two.

Is the Correlation Always Correct?

The bottom line is no correlation will ever work perfect. A good example of this is OIL was strong yesterday, however with the Canadian forex fires in Alberta one had to be vigilant to see how this was effecting the overall production of the sands oil and how it may effect the economy regardless of the OIL price. I feel in the end the OIL price is the most important factor in the USD/CAD and will eventually correct itself. For this reason I will always have an eye on the OIL price when trading the USD/CAD. Here is a short video to give you an idea of how I day Trade OIL. There are no tricks here and I apply fundamentals as well as technicals when trading Futures as well as Forex.