Forex: USD/CAD Technical Analysis – Loonie Strengthens as Expected
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- USD/CAD Technical Strategy: Flat
- Support: 1.1036 (50% Fib exp.), 1.0999 (618% Fib exp.)
- Resistance: 1.1074 (38.2% Fib exp.), 1.1119 (23.6% Fib exp.)
Prices moved lower as expected after putting a Shooting Star candle. Sellers are aiming to challenge the 50% Fibonacci expansion at 1.1036, with a break below that exposing the 61.8% level at 1.0999. Alternatively, a turn back above the 38.2% Fib at 1.1074 targets the 23.6% expansion at 1.1119.
A close above the Shooting Star high at 1.1194 is a logical invalidation condition for a short position but the close proximity between current prices and near-term technical targets doesn’t allow for establishing at least 1:1 risk/reward parameters on this basis. As such, we will continue to stand aside.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com