USD/CAD Bearish Engulfing Pattern Warns Of Further Weakness
- USD/CAD Technical Strategy: Sidelines Preferred
- Bearish Pattern Emerges On Pullback from 1.0980 Barrier
- Awaiting Close Below 1.0900 To Open Drop To 1.0854
USD/CAD is in danger of completing a double top formation on the back of a Bearish Engulfing candlestick pattern. If the key reversal signal is confirmed by the close of the current candle it could leave the pair vulnerable to further weakness. A crawl under the psychologically-significant 1.0900 handle would set the scene for a run on the recent lows near 1.0854.
USD/CAD: Retreats From Critical 1.0980/95 Barrier
Daily Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here
A similar narrative to the daily is evident on the four hour chart. A Bearish Engulfing formation near the 1.0995 ceiling offered an early indication of a potential pullback over session. Buying interest at the 1.0900 hurdle may slow the pair’s descent, yet an absence of bullish candlestick patterns casts some doubt on the potential for a corrective bounce.
USD/CAD: Bearish Pattern Offered Early Warning Sign
4 Hour Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here
By David de Ferranti, Currency Analyst, DailyFX
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