The big surprise on employment today was in Canada, where the economy added 108.3K jobs, compared to expectations of 10,000. This dropped USD/CAD to 1.35 , a full cent from the pre-report level and up 200 points in the day This is becoming a major crisis as China’s reopening and Russia’s price cap affect oil. USDCAD 15 min d Zooming out on the daily chart, it looks like a clear head and shoulders pattern. USDCAD Head and Shoulders The bond market is experiencing a revaluation of the Bank of Canada base rate. Canada’s 2-year yield rises 11 basis points to .19%, compared to 5 basis points for Treasuries. That’s a sharp turnaround from 3.80 percent after the Bank of Canada’s decision. In the OIS market, the expected probability of 50 bhas on December 7 is as high as 70% and the rest 30%. It was translated after the BOC decision. With China strongly hinting at reopening today and the US in the midst of major infrastructure spending, much of the profit is flowing to Canada through manufacturing and commodities. This is doubly true at USD/CAD 1.35, making Canada very competitive. The target of Head and Shoulders is 1.30.