USD/CAD Technical Analysis: Major Support Shelf Pressured
To receive Ilya's analysis directly via email, please SIGN UP HERE
- USD/CAD Technical Strategy: Flat
- Support: 1.2328, 1.2181, 1.2035
- Resistance: 1.2557, 1.2646, 1.2827
The US Dollar turned lower against its Canadian counterpart as expected after putting in a Bearish Engulfing candlestick pattern. Near-term support is in the 1.2328-81area, marked by the 38.2%Fibonacci retracement and the January 27 low, with a break below that on a daily closing basis exposing the 50% level at 1.2181. Alternatively, reversal above trend line support-turned-resistance at 1.2557 opens the door for a challenge of the 23.6% Fib expansion at 1.2646.
Risk/reward considerations argue against entering short with prices in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
Add these technical levels directly to your charts with our Support/Resistance Wizard app!
Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com