Canada Economy

Totally lost in the shuffle today was the weak econodata from Canada. May GDP was negative 0.3% and mostly attributed to oil and gas industries' slowdown. I wrote a piece earlier discussing this phenomenon of Canada's economy direct correlation to oil and US economy http://viewonmarkets.blogspot.com/2011/06/oil-part-3.html

CAD dove on this news, and traders are now focused on rate hike being less likely. To make things even worse for those who expected a hike, this morning Canadian wholesale prices report showed a decline vs expected rise, and by a lot I would say. Bummer!!
Not a surprise folks. Mr. Carney's comments from June gave us the hint. Somehow we knew well in advance...

This development takes care of one of the closest stock market-correlated currencies. Plot CAD over SPX and you will see what I mean. This is a hint where SPX is heading.
Furthermore, it will help DXY to bottom.