Forex: USD/CAD Technical Analysis – Treading Water Above 1.10
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- USD/CAD Technical Strategy: Flat
- Support: 1.1019 (23.6% Fib ret.), 1.0859 (38.2% Fib ret.)
- Resistance: 1.1103 (trend line), 1.1126 (horizontal pivot)
The US Dollar declined as expected against its Canadian counterpart, with prices now in consolidation mode having cleared a rising trend line set from mid-February. Support is now at 1.1019, the 23.6% Fibonacci retracement, with a break below that exposing the 38.2% level at 1.0859. The trend line, now at 1.1103, has been recast as near-term resistance. A rebound above that targets a horizontal pivot at 1.1126.
Risk/reward considerations argue against entering short while prices trade so close to relevant support. On the other hand, a long position lacks an actionable upward reversal signal to suggest that resistance will hold. As such, we will remain flat for now.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com