[achiever]

I think this move is on the back of fear in the market related to potential problems with US & European banks. Traders may be getting to hyped up given the rough day equities are having. Another 100 banks are expected to default and that's not new news.

Equity and crude markets are like the weaker boxer in a UFC match today and are taking a hard beating in the ring. As a result, the US dollar is rallying and we've popped above 1.10. I think this could be a good opportunity if you've been waiting to sell some US dollars.

The market has been range-bound over the last few weeks trading in a 1.0750 - 1.1150 range. We need a close below or above this range to establish new price direction, and in the interim continue to play the ranges. Given how the market's been trading recently, I like selling in the 1.10 zone as it's too easy to "miss the boat" if you're only target is 1.11 or higher.

In general, I think the Bank of Canada will try and talk the currency down if we get too close to 1.05, putting a bit of a base in the market. I don't think our economy's recovered enough to be able to carry a USDCAD rate at par. That being said, we'd need a pretty hard sustained equity and crude selloff in order to get back towards 1.15, and that depends on whether the global economy gets another bad wake-up call.

In the interim, try not to get too motion sick on this roller coaster.