USD/CAD Technical Analysis: Digesting After Breakdown
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- USD/CAD Technical Strategy: Flat
- Support: 1.2328, 1.2181, 1.2035
- Resistance: 1.2526, 1.2646, 1.2827
The US Dollar paused to consolidate losses against its Canadian namesake after falling as expected following the appearance of a Bearish Engulfing pattern. A daily close below the 1.2328-81area marked by the 38.2%Fibonacci retracement and the January 27 low exposes the 50% level at 1.2181. Alternatively, a turn above trend line support-turned-resistance at 1.2526 clears the way for a test of the 23.6% Fib expansion at 1.2646.
The available trading range is too narrow to justify entering a trade on the long or short side from a risk/reward perspective. With that in mind, we will remain flat for now, waiting for price action to offer a more compelling opportunity down the road.
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Daily Chart - Created Using FXCM Marketscope
--- 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.