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Canadian Dollar Forecast to Rally

Canadian Dollar Forecast to Rally

David Rodriguez, Head of Product
ssi_usd-cad_body_Picture_2.png, Canadian Dollar Forecast to Rally

Retail forex trading crowds have bought aggressively into US Dollar (ticker: USDOLLAR) declines against the Canadian Dollar. The build in long positions gives us a contrarian bearish bias and keeps us focused on further USDCAD declines. In fact, total long interest rose 18 percent overnight and shorts fell by a similar 13 percent.

Extremely one-sided sentiment warns that the USDCAD may fall further through short-term trading. Focus remains on key USDCAD lows as a break below could accelerate US Dollar losses and Canadian Dollar gains.

How do we interpret and trade with the SSI? Watch an FXCM Expo Presentation that explains the SSI.

--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com

To receive the Speculative Sentiment Index and other reports from this author via e-mail, send a message with subject line “Distribution List” to drodriguez@dailyfx.com; Contact David via Twitter at http://www.twitter.com/DRodriguezFX

Meet the DailyFX team in Las Vegas at the annual FXCM Traders Expo, November 2-4, 2012 at the Rio All Suite Hotel & Casino. For additional information regarding the schedule, workshops and accommodations, visit the FXCM Trading Expo website.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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