USD/CAD Technical Analysis: Trying to Bottom Above 1.06
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- USD/CAD Technical Strategy: Flat
- Support: 1.0643, 1.0613, 1.0563
- Resistance: 1.0700, 1.0749, 1.0790
The US Dollar is attempting to carve out a bottom against its Canadian namesake as expected after prices completed a bullish Piercing Line candlestick pattern. A daily close above resistance in the 1.0691-1.0700 area – marked by a trend line set from September 2012 and the 23.6% Fibonacci retracement – exposes the 38.2% level at 1.0749. Alternatively, a break below the 14.6% Fib expansion at 1.0643 opens the door for a test of the 1.0613-20 region bracketed by the July 3 low and the 23.6% mark.
On one hand, a pullback over the past three days has put prices squarely at support without a defined bullish reversal, making us leery to enter long. On the other, the upside implications of the Piercing Line pattern remain intact. We will opt to stand aside for now until greater clarity emerges.
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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.