USD/CAD Technical Analysis: Stalling After Bearish Reversal
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- USD/CAD Technical Strategy: Flat
- Support: 1.0853, 1.0809, 1.0765
- Resistance:1.0908, 1.0942, 1.0985-97
The US Dollar dropped against its Canadian counterpart as expected after putting in a Dark Cloud Cover candlestick pattern coupled with negative RSI divergence. Near-term support is at 1.0853, the 38.2% Fibonacci retracement, with a break below that on a daily closing basis exposing the 50% level at 1.0892. Alternatively, a reversal above the 23.6% Fib at 1.0908 opens the door for a challenge of the 14.6% retracement at 1.0942.
Prices are too close to support to justify entering short from a risk/reward perspective. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. With that in mind we will remain flat for now.
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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.