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USD/CAD Retests "Breakout" Point As Harami Awaits Validation

USD/CAD Retests "Breakout" Point As Harami Awaits Validation

David de Ferranti, Currency Analyst

Talking Points

  • USD/CAD Technical Strategy: Longs Preferred
  • Harami To Warn of Weakness If Confirmed
  • Breakout Above 1.1040 Opens Run Towards 1.1270

USD/CAD is once again at a crossroads as the pair retests its initial “breakout” point with a Harami pattern in its wake. A daily close below the 1.1040/50 floor would confirm the key reversal pattern and warn of a pullback to 1.0980. Yet, within the context of an emerging uptrend on the daily, longs remain preferred with a target offered by the 2014 high near 1.1270.

USD/CAD: Harami Awaiting Confirmation Near Key Level

Daily Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

The four hour chart paints a divergent picture to the daily. A bullish Harami formation and respect of 1.1030/40 hints at a continued recovery for USD/CAD. Selling pressure is likely to be renewed on a test of the nearby 1.1095/1.1100 ceiling.

USD/CAD: Bullish Signal Hints At A Retest Of Recent Highs

4 Hour Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

By David de Ferranti, Currency Analyst, DailyFX

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