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- USD/CAD Technical Strategy: Flat
- Support: 1.0934, 1.0858, 1.0802
- Resistance: 1.1038, 1.1108, 1.1164
The US Dollar declined against its Canadian counterpart as expected after prices put in a bearish Dark Cloud Cover candlestick pattern. A daily close below rising trend line support at 1.0934 exposes the 50% Fibonacci retracement at 1.0858. Alternatively, a reversal back above the 23.6% Fib expansion at 1.1038 clears the way for a test of the 1.1098-1.1108 area, bracketed by the September 12 high and the 38.2% threshold.
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 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 2.0
— Written by Ilya Spivak, Currency Strategist for DailyFX.com