Another month is coming to the end, and after all the China- and Greece-related fears of late June and early July, the lower-volatility “dog days” of summer (all due apologies to Southern hemisphere readers) have finally come to the fore over the last couple weeks.
We see a rally in the dollar/loonie currency pair today from wave (X) low at 1.212 is unfolding in triple corrective structure WXYZ where wave W ended at 1.2423, wave X ended at 1.23, wave Y ended at 1.263, and second wave X ended at 1.2537.
Combined with last week’s technical breakdown below 57.00, traders took these comments as a green light to drive WTI down to a low near 52.00 so far. “Black gold” is now testing the 50% Fibonacci retracement of its entire Q2 rally at 52.30, but if that level gives way, a continuation down toward the 61.8% retracement near the psychologically-significant $50 level could be next.
One pair we haven’t examined in depth yet this week is USD/CAD, which has broken below key previous support at 1.2400 amidst Friday’s strong Canadian jobs report and yesterday’s big rally in oil prices.