Forex: USD/CAD Technical Analysis – Quiet Consolidation Continues
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- USD/CAD Technical Strategy: Flat
- Support: 1.1019 (23.6% Fib ret.), 1.0859 (38.2% Fib ret.)
- Resistance: 1.1098 (trend line), 1.1126 (horizontal pivot)
The US Dollar continues to tread water against its Canadian counterpart after prices slumped past a rising trend line set from mid-February. Initial support is at 1.1019, the 23.6% Fibonacci retracement, with a breach and daily close below this barrier clearing the way for a test of the 38.2% level at 1.0859. The trend line, now at 1.1098, has been recast as near-term resistance. A reversal above that targets a horizontal pivot at 1.1126.
Prices are too close to relevant support to justify a short position at current levels from a risk/reward perspective. On the other hand, a long position absent a defined reversal signal seems premature. On balance, we will remain flat for the time being until something more attractive presents itself.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com