CAD Analysis and Talking Points
See the DailyFX Q2 FX forecast to learn what will drive the currency throughout the quarter.
USDCAD | Key Support Holding for Now
Despite last weeks topside breach of the 1.3520 level, failure to consolidate above has seen USDCAD return to its 2-month range with a test now on for a move below 1.34. Consequently, focus on the downside will be the 1.3350-70 zone in which the pare has previously found support. Momentum indicators have tilted to a bearish bias albeit modest so, which in turn could see any downside breaks meet strong support. As such, for a bearish momentum to build eyes will be on for a close below 1.3350, which in turn could open scope for a move towards the 200DMA situated at 1.3270.
USDCAD PRICE CHART: Daily Time Frame (Dec 2018 – June 2019)
CADJPY | Bearish Trend Remains
As we have continued to highlight, the trend in CADJPY remains bearish with yesterday providing another example that upticks have been short-lived. Momentum indicators in the short- and long-term timeframes continue to tilt to the downside. Consequently, the cross is now testing key support stemming from the 2017 and 2018 lows (80.50-65) having broken back below the 23.6% Fib level (80.82). As such, a closing break below will raise the risk of another test of the 80.00 handle as CADJPY looks to make a return to flash crash lows. On the topside however, resistance sits at 81.00, while the bearish momentum could abate somewhat providing the cross breaks above 82.00.
CADJPY PRICE CHART: Daily Time Frame (Aug 2018 – June 2019)
--- Written by Justin McQueen, Market Analyst
To contact Justin, email him at Justin.mcqueen@ig.com
Follow Justin on Twitter @JMcQueenFX
