The Canadian is showing impressive chart action and like the Pound it sits right under acritical upside breakout on the charts. While the 50 day moving average sits all the way up at 90.08 and a downtrend channel resistance line sits all the way up at 90.37 the market is poised for a trend decision soon. We agreewith the need to see the Canadian recover over the long term, but unless the Dollar is set to come away from theFOMC meeting damaged and in a sharp decline, buyers of the Canadian might be chasing the market intoresistance levels. A good long term bottoming play in the Canadian, might be to challenge the near term rally withthe purchase of 3 March Canadian 91 calls for 70 each and sell a Canadian futures. If the currency has bottomedthe calls will quickly outdistance the short futures loss but a correction from the October bounce of roughly 187ticks could result in a partial to significant financing of the longer term call position play.
