USD/CAD Technical Analysis: 1.28 May Mark Double Top
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- USD/CAD Technical Strategy: Flat
- Support: 1.2635, 1.2381, 1.2187
- Resistance: 1.2801, 1.2968, 1.3158
The US Dollar may be carving out a double top against its Canadian counterpart as negative RSI divergence hints at ebbing upside momentum. Near-term resistance-turned-support is at 1.2365, with a break below that on a daily closing basis exposing Triangle floor support at 1.2381. Alternatively, a push above the January 30 high at 1.2801 clears the way for a test of the 38.2% Fibonacci expansion at 1.2968.
Risk/reward considerations argue against entering long with prices in close proximity to resistance. On the other hand, the absence of a defined bearish reversal signal suggests taking up the short side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
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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.