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Forex: USD/CAD Technical Analysis – Triangle Confirmation Pending

Forex: USD/CAD Technical Analysis – Triangle Confirmation Pending

2014-03-13 23:07:00
Ilya Spivak, Head Strategist, APAC
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Talking Points:

  • USD/CAD Technical Strategy: Flat
  • Support: 1.0974 (Triangle bottom, trend line), 1.0825 (38.2% Fib ret.)
  • Resistance: 1.1166 (Triangle top), 1.1194-1.1223 (Feb 21, Jan 31 highs)

A period of consolidation since late January may precede a renewed push higher from the US Dollar against its Canadian counterpart. Sideways trade is taking the shape of a Triangle chart formation, a setup typically indicative of trend continuation (which carries upside implications in this case). A break above the Triangle top at 1.1166 aims for recent swing highs in the 1.1194-1.1223 area. Alternatively, a break below support at 1.0974 marked by the Triangle bottom and a rising trend line set from late October exposes the 38.2% Fibonacci retracement at 1.0825.

The Triangle setup is not actionable until confirmation is seen on a daily close above the pattern’s upper boundary. We look for that to materialize before looking for an attractive long trade setup.

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dailyclassics_usd-cad_body_Picture_12.png, Forex: USD/CAD Technical Analysis – Triangle Confirmation Pending

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

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

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