USD/CAD Stalls At Former High
- USD/CAD breaks away from triangle pattern
- 1.2800 and 1.2400 levels look critical
Unfamiliar with Gann Square Root Relationships? Learn more about them HERE.
After a few stutter steps USD/CAD finally broke out of the consolidation pattern that has defined trading over the past month with a close last Friday above the trendline connecting the late January and February highs. After a quick initial push higher the exchange rate has since stalled after re-testing the year’s high at 1.2797. Hesitation around the old high is not that surprising and weakness could actually even extend down towards the internal trendline around 1.2550 without compromising the integrity of the pattern structure too much. Weakness, however, below 1.2500 would start to be a cause concern while a move under the trendline connecting the February lows near 1.2400 would turn the picture outright negative. A close over 1.2800 is needed to signal that a new leg higher is underway.
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USD/CAD Daily Chart: March 13, 2015
Charts Created using Marketscope – Prepared by Kristian Kerr
Key Event Risk in the Week Ahead:
LEVELS TO WATCH
Resistance: 1.2797 (YTD high), 1.2930 (Gann)
Support: 1.2630 (Fibonacci), 1.2550 (Internal trendline)
Strategy: Buy USD/CAD
Entry: Buy USD/CAD if it trades down to 1.2550 within the next couple of trading days
Stop: Daily close below 1.2500
--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com
To contact Kristian, e-mail email@example.com. Follow me on Twitter at@KKerrFX.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.