[AndrewWoo]

Did the US dollar just rally 250 points? Below is a nice recap of what went down. At the end of the day, the current trend of US dollar weakness still remains intact. Some good selling opportunities may arise over the next couple of days, but don’t bet on a flown blown rally just yet. This move will have to continue for another day or two to trigger a new trend. Volatility is crazy right now.

North American Spot Trading Activity: CAD Takes a Beating
USD/CAD spiked to 1.11 today, as stop loss buying and weak equity and commodity markets boosted the USD across the board. The day began at the bottom end of the trading range, with early interbank buying interest triggering stop loss flows above the 1.0880-1.0900 region. This caused a quick extension to the 1.0985 area before the market paused to catch its breath. However, with equity and commodity markets remaining under pressure throughout the day, the pause proved to be very brief. Corporate offers were offset by interbank and fund bids in this regard, as broad-based USD strength eventually led to a spike above 1.11 before prices peaked for the day.

Bearish Long-Term Trend Reversal Still Intact
Long-term sentiment began to shift for USD/CAD based on the May 29 monthly close below key support at 1.1122. Resistance at 1.1099 and 1.1373 is expected to attract selling interest based on the intermediate downtrend that is in effect – with support at 1.0818 serving as an initial downside price target, followed by 1.0709. Prices will have to register a daily close above 1.1373 in order to nullify the current downtrend.