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- USD/CAD Technical Strategy: Long at 1.0935
- Support: 1.0857 (Apr 9 low)
- Resistance: 1.1017-31 (14.6% Fib exp., trend line), 1.1116 (23.6% Fib exp.)
The US Dollar may be preparing to launch a recovery against its Canadian counterpart after prices put in a Bullish Engulfing candlestick pattern. We will attempt a long position, initially targeting the 14.6% Fibonacci expansion at 1.1017. This barrier is reinforced by the underside of a previously broken rising trend line at 1.1031, with a break above the latter level exposing the 23.6% Fib at 1.1116. A stop-loss will be activated on a daily close below 1.0857, the April 9 low. We will take profit on half of the position at 1.1017 and trail the stop to the breakeven on the remainder of the trade, allowing for the possibility of capturing a larger up move.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com