USD/CAD Technical Analysis – May Bottom in the Spotlight
To receive Ilya's analysis directly via email, please SIGN UP HERE
- USD/CAD Technical Strategy: Flat
- Support: 1.0813-22 (May 8 low, 50% Fib exp.), 1.0803 (trend line), 1.0793 (61.8% Fib exp.)
- Resistance: 1.0850 (38.2% Fib exp.), 1.0874-85 (trend line, 23.6% Fib exp.)
The US Dollar attempted to bounce as expected after forming a Piercing Line candle pattern but follow-through has been disappointing. Near-term support is in the 1.0813-22 area, marked by the intersection of the May 8 low and the 50% Fibonacci expansion. A break below that exposes a falling trend line set from mid-February, now at 1.0801, followed by the 61.8% level at 1.0793. Alternatively, a reversal above the 38.2% level at 1.0850 targets the 1.0874-85 zone, the site of a downward-sloping barrier set from late April and the 23.6% Fib.
The available trading range is too narrow to justify taking a trade on the long or the short side from a risk/reward perspective. We will remain on the sidelines for now, waiting for a more actionable opportunity to present itself.
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.