USD/CAD Technical Analysis: Candle Setup Hints at Losses
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- USD/CAD Technical Strategy: Flat
- Support: 1.1134, 1.1080, 1.0992
- Resistance: 1.1220, 1.1308, 1.1379
The US Dollar might be carving out a top against its Canadian namesake after putting in a Bearish Engulfing candlestick pattern. Near-term support is at 1.1134, the 14.6% Fibonacci retracement, with a break below that on a daily closing basis exposing the 23.6% level at 1.1080. Alternatively, a reversal above the 23.6% Fib expansion at 1.1220 clears the way for a test of the 38.2% threshold at 1.1308.
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