Canadian Dollar Tech Outlook: USD/CAD Price -What is Below The Monthly Low?
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Canadian Dollar Forecast
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USD/CAD – Sellers Taking Charge
On Tuesday USD/CAD printed 1.3382 – its highest level in nearly seven weeks. However, the pair slipped back in the following days losing roughly 1.0% of its value.
Alongside this the Relative Strength Index (RSI) fell sharply from 62 and dipped below 50 highlighting the start of a bearish momentum.
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USD/CAD DAILY PRICE CHART (JUne 1, 2017 – Sep 6, 2019) Zoomed Out
USD/CAD DAILY PRICE CHART (JUly 1 – Sep 6, 2019) Zoomed In
Looking at the daily chart, we notice on Wednesday USD/CAD moved to a lower trading zone 1.3166 – 1.3256 heading for a test of the low end of the zone, contingent on clearing the monthly low residing at 1.3177.
Hence, a close below the low end of the zone may continue bearish price action towards 1.3124. That said, sellers need to pay a close attention on the weekly support underlined on the chart (zoomed in). Further close below 1.3124 may press USDCAD towards 1.3064. Nonetheless, the weekly supports marked on the chart should be kept in focus.
On the other hand, any failure to close below the low end of the zone could reverse the pair’s direction sending the price back to the high end. Further close above the high end might push USDCAD towards 1.3357. In that scenario, the daily resistance levels underscored on the chart would be worth monitoring.
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USD/CAD Four-HOUR PRICE CHART (AUG 14 – Sep 6, 2019)
Looking at the four-hour chart, we notice on Wednesday USD/CAD corrected lower breaking below the uptrend line originated from the 18 July low at 1.3016.
Therefore, a break below 1.3144 could mean more bearishness towards 1.3105. Although, the weekly supprot level at 1.3124 needs to be considered.
On the flip side, any U turn at this stage could create a double bottom pattern. In this plot, if the price rallies and remains above the neckline located at 1.3247 this suggests buyers could push USDCAD towards 1.3296. However, the high end of the current trading zone should be watched closely.
Written By: Mahmoud Alkudsi
Please feel free to contact me on Twitter: @Malkudsi
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.