USD/CAD at critical juncture with bearish oil weighing hard

USD/CAD has been in heavy supply breaking below the 1.30 handle on a day where oil was walloped by over $2 on further builds in stocks and the BoC held rates.

EIA weekly US oil inventories came in at -2546K vs -3000K expected while the

Bank of Canada holds rates at 0.50%, as expected. The Cad was somewhat supported by Poloz remaining upbeat, despite Brexit concerns and global slowdown, "The expansion of activity in the non-resource sector will assert itself as the dominant trend in the second half of 2016."  One to watch here is oul and stocks. Stocks highly inflated and should they come off, oil could also come under pressure and USD/CAD could face lows scored in June. 

USD/CAD levels

The price has been pressured hard below the 20 sma on the 4hr chart at 1.3055 and slipped below the 100 dma on the same time frame at 1.2966. We have reverted since and are oscillating at a key juncture just north of the mid point of the 129 handle. Below the lows, opens the 200 4hr sma at 1.2926 and a break of that compromises the bullish support line from mid June lows of 1.2678.