USD/CAD Technical Analysis – Rally Stalls Below 1.10 Mark
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- USD/CAD Technical Strategy: Flat
- Support: 1.0856 (trend line), 1.0828 (double bottom?)
- Resistance: 1.0923-41 (23.6% Fib ret., May 21 high), 1.0991 (38.2% Fib ret.)
The US Dollar may be carving out a double bottom above the 1.08 figure in preparation for a turn higher against its Canadian namesake. Near-term resistance is in the 1.0923-41 area, marked by the 23.6% Fibonacci retracement and the May 21 high, with a break above that targeting the 38.2% level at 1.0991. Alternatively, a below support at 1.0881 – the 14.6% Fib – aims for falling trend line support-turned-resistance set from late April, now at 1.0850.
Risk/reward considerations argue against entering long with prices sitting squarely at resistance. On the other hand, taking up the short side seems premature absent a defined bearish reversal signal. We will remain flat for now.
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.