USD/CAD: Buy On Weakness As Oil/DXY Stand

The path of least resistance for the pair should be higher if one takes as reference the slope of its two most correlated instruments (DXY + Oil). The DXY in magenta leaves no room for doubt. Even if the 25-HMA slope in Oil (thin red line) was to turn south, there is still a significant macro divergence in favor of the USD/CAD as the 125-HMA (5-DMA) demonstrates (thicker red line). The fact that the pair trades higher than its pre-blockbuster Canadian jobs report is a clear testament that even if an episode of selling pressure may occur due to economic data, the flows are in favor of the bulls here.