Forex: USD/CAD Technical Analysis – Stalling at 3-Month Support
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- USD/CAD Technical Strategy: Flat
- Support: 1.0974 (trend line), 1.0859 (38.2% Fib ret.)
- Resistance: 1.1019 (23.6% Fib ret.), 1.1126 (horizontal pivot)
The US Dollar is stalling after sinking to a one-month low against its Canadian namesake having four a top below the 1.12 figure, as expected. Pushing below rising trend line support set from mid-January, now at 1.0974, initially targets the 38.2% Fibonacci retracement at 1.0859. Alternatively, a reversal back above resistance at 1.1019, 23.6% Fib, exposes a horizontal pivot at 1.1126.
Risk/reward considerations argue against entering short with prices squarely at relevant support. On the other hand, taking up the long side looks premature absent a defined bullish reversal signal. With that in mind, we will remain flat for now.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com