USD/CAD Technical Analysis: Looking to Buy on Pullback
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- USD/CAD Technical Strategy: Pending Long at 1.2500
- Support: 1.2501, 1.2354, 1.2230
- Resistance: 1.2646, 1.2827, 1.2973
The US Dollar looks poised to resume the rising trend against its Canadian namesake after prices broke out of a Triangle pattern in play since late January. A daily close above the 23.6% Fibonacci expansion at 1.2646 exposes the 1.2801-27 area marked by the January 30 high and the 38.2% level. Alternatively, a reversal below Triangle top resistance-turned-support at 1.2501 clears the way for a test of the February 2 low at 1.2354.
Prices are too close to resistance to justify entering long at market from a risk/reward perspective. With that in mind, we will establish a pending order to buy the pair at 1.2500. If triggered, the trade will initially target 1.2646 and carry a stop-loss activated on a daily close below 1.2354.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com