USD/CAD Technical Analysis: Topping Cues Remain Intact
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- USD/CAD Technical Strategy: Flat
- Support: 1.1098, 1.1021, 1.0945
- Resistance: 1.1278, 1.1329, 1.1406
The US Dollar may move lower against its Canadian counterpart after prices completed a Bearish Engulfing candlestick pattern. A daily close below 1.1098-1.1116 area marked by the September 15 high and the 23.6% Fibonacci retracement exposes the 38.2% level at 1.1021. Alternatively, a turn above the March 20 high at 1.1278 opens the door for a challenge of the 38.2% Fib expansion at 1.1329.
Positioning looks conflicted at this point. On one hand, follow-through on the bearish candlestick setup has been lackluster. On the other, the setup remains technically valid absent a daily close above 1.1270, the pattern’s high. We will opt to remain on the sidelines for now, waiting for greater clarity.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com