Dec 8th, 2015: Oil Hits 7 Year Low

• This morning, commodities and commodity currencies continue to come under pressure as oil prices hit seven year lows overnight. In its latest meeting, OPEC failed to reach an agreement on how to combat the current oil glut, putting to bed thoughts that oil producers could come together to control production.

• The Australian dollar has been hit hard, especially after Chinese trade balance came in well below expectations.

• The New Zealand dollar has been pressured, but is holding up well today despite expectations for a rate cut on Thursday.

• The euro is holding firm this morning after two days of gains, as the dollar index remains unchanged so far.

Coming up today: 

• Today we have UK Halifax HPI at 08.00, followed by manufacturing production at 09.30.
• Canadian building permits follows at 13.30, followed by BOC governor Poloz speaking at 17.50.
• At 15.00 we have UK NIESR GDP estimate, released alongside US JOLTS job openings.
• ECOFIN meetings run throughout the day.

Trade Idea: 

• The Canadian dollar has been hit particularly hard of late, as one of currencies most directly impacted by the recent oil price slump.

• With no end in sight for the oil bear market, a good way to play this is a LOWER trade predicting that the USD/ CAD will close above 1.3600 in 45 days for a potential return of 150%.

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