USD/CAD Technical Analysis – Doji Candle Hints at Rebound
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- USD/CAD Technical Strategy: Long at 1.0907
- Support: 1.0849 (May 19 low), 1.0832 (trend line), 1.0813 (May 8 low)
- Resistance: 1.0973 (14.6% Fib exp.), 1.1072 (23.6% Fib exp.)
The US Dollar broke out upward as expected against its Canadian counterpart after prices completed a bullish Piercing Line candlestick pattern. A Doji candle at trend line resistance-turned-support (now at 1.0832) hints the up move is readying to resume after a brief pullback. The first major layer of resistance is at 1.0973, the 14.6% Fibonacci expansion, with a daily close above that exposing the 23.6% level at 1.1072. Immediate support is at 1.0849, the May 19 low, followed by the falling trend line and the May 8 low at 1.0813.
We bought USDCAD at 1.0907, initially aiming for1.0973. A stop-loss is set to trigger on a daily close below1.0849. We will take profit on half of the position at 1.0973 and trail the stop-loss to the breakeven level.
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.