Forex: USD/CAD Technical Analysis – Preparing to Turn Higher?
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- USD/CAD Technical Strategy: Flat
- Support: 1.1019 (trend line cluster, 23.6% Fib ret.), 1.0859 (38.2% Fib ret.)
- Resistance: 1.1126 (horizontal pivot), 1.1278 (Mar 20 high)
The US Dollar may be readying to turn higher anew against its Canadian counterpart after prices put in a Harami candlestick pattern. Initial resistance is at 1.1126, a horizontal pivot, with a break above that on a daily closing basis exposing the March 20 high at 1.1278. Near-term support is at 1.1019, the intersection of a trend line cluster and the 23.6% Fibonacci retracement. A break below this boundary targets the 38.2% level at 1.0859.
Our attempted long positionfrom 1.1166 was stopped out last week. We are not averse to re-entering the trade in principle, but a Harami pattern seems relatively flimsyby itself to justify doing so. With that in mind, we will wait for added confirmation before re-establishing a long.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com