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USD/CAD Bullish Engulfing Pattern Puts Recovery On The Cards

USD/CAD Bullish Engulfing Pattern Puts Recovery On The Cards

David de Ferranti, Currency Analyst

Talking Points

  • USD/CAD Technical Strategy: Sidelines Preferred
  • Bullish Engulfing awaits confirmation
  • Four hour chart suggests indecision near 1.0900

USD/CAD has reversed course following a break below the 1.0860 mark. The recovery in prices has prompted the emergence of a Bullish Engulfing candlestick pattern which suggests further gains may be possible. However, given past price action suggests the potential emergence of a downtrend, it remains to be seen whether this is a mere corrective bounce within the broader trend. Confirmation from a second successive up-day would help validate the signal.

USD/CAD: Key Reversal Pattern Emerges As Bulls Return

USD/CAD Bullish Engulfing Pattern Puts Recovery On The Cards

Daily Chart - Created Using FXCM Marketscope 2.0

Several Doji formations near the critical 1.0900 mark suggests that the bulls have seemingly lost steam in intraday trading. This suggests a push past the resistance level may be preferred before looking at longs.

USD/CAD: Hanging Man Delivers Drop

USD/CAD Bullish Engulfing Pattern Puts Recovery On The Cards

4 Hour Chart - Created Using FXCM Marketscope 2.0

By David de Ferranti, Market Analyst, DailyFX

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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.