Correlation between Canadian dollar and crude oil is widely known and recently they are begin traded in lockstep. As we shorted crude oil yesterday from 48, we picked up some USD/CAD long with corresponding near 1.2900. Since then it has shot up 100 pips but looks like the trade is not over yet. We are taking partial profit here but willing to add to the position near 1.2950. Today's NFP release can make or break the trade but if things are not disturbed until BOC next week then USD/CAD has still upside of around 300 / 400 pips left in it. Initially we are targeting 1.3200 / 1.3300 and then next range is 1.3400 / 1.3500. As long as crude oil is supportive, these levels may come sooner than later.
We did the similar USD/CAD Vs Crude Oil trade last month too with good results.