USD/CAD Technical Analysis: Waiting for Direction Cues
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- USD/CAD Technical Strategy: Flat
- Support: 1.1204, 1.1092, 1.1002
- Resistance: 1.1329, 1.1406, 1.1483
The US Dollar may be forming a top against its Canadian namesake as negative RSI divergence points to fading upward momentum. A daily close below the intersection of a rising channel floor and the 23.6% Fibonacci retracement in the 1.1204-20 area exposes the 1.1092-98 zone (38.2% level, September 15 high). Alternatively, a push above the 38.2% Fib expansion at 1.1329 opens the door for a challenge of the 23.6% threshold at 1.1406.
Positioning is inconclusive at this point. While RSI divergence hints a turn lower is ahead, confirmation on a break through support that would invalidate the uptrend from September low is still pending. On the other hand, a defined bullish signal countering negative cues is absent. We will remain flat 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.