Aud/Cad: Price action on the cross has been constructive since February with gains extending to 0.8660 on Tuesday ahead of the latest minor consolidation. The current 2009 high comes in by 0.8690 from back on January 5, and while we would expect to see a retest of this level in the short-term, we don’t foresee gains extending much further with daily studies so highly overbought. The broader structure is bearish and as such, we will use any test of the 2009 high on Friday as an opportunity to establish a compelling short trade. Strategy: SELL @0.8690 FOR A 0.8350 OBJECTIVE, STOP @0.8815. Stops to be trailed to cost (break-even) on a break back below 0.8640. If trade triggers and 0.8640 not broken, position to be closed out at close on Friday. Recommendation to be removed if not triggered Friday.
Written by Joel Kruger, Technical Currency Analyst for DailyFX.com
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