USD/CAD Technical Analysis: Downward Momentum Resumes
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- USD/CAD Technical Strategy: Flat
- Support: 1.2131, 1.2021, 1.1933
- Resistance: 1.2198, 1.2307, 1.2397
The US Dollar renewed the push downward against its Canadian counterpart having found a top below the 1.27 figure as expected. Near-term support is at 1.2131, the 23.6% Fibonacci expansion, with a break below that on a daily closing basis exposing the 38.2% level at 1.2021. Alternatively, a rebound above the 14.6% Fib at 1.2198 opens the door for a challenge of the April 21 high at 1.2307.
Prices are too close to support to justify entering short from a risk/reward perspective. On the other hand, the absence of a defined bullish reversal signal suggests that taking up the long side is premature. With that in mind, we will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com