Forex: USD/CAD Technical Analysis – Idling at Support Below 1.11
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- USD/CAD Technical Strategy: Flat
- Support: 1.1067 (23.6% Fib ret.), 1.0970 (38.2% Fib ret.)
- Resistance: 1.1223 (Jan 31 high)
The Canadian Dollar continues to idle above support at 1.1067 to the US Dollar, a barrier marked by the 23.6% Fibonacci retracement. A daily close below this level initially targets the 38.2% Fib at 1.0970. Near-term resistance continues to stand at 1.1223, the January 31 high.
Narrow bodies and long wicks on the last several candles suggest indecision at support, which may signal ebbing bearish conviction and precede a reversal higher. Confirmation is absent for now however, arguing against entering long. On the other hand, entering short would take as given that support will give way, an assumption that is baseless thus far. On balance, we will hold off on taking a position for now until a defined directional signal emerges.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com