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- USD/CAD Technical Strategy: Flat
- Support: 1.0643, 1.0613, 1.0563
- Resistance: 1.0700, 1.0749, 1.0790
The US Dollar is trying to build upward as expected against its Canadian counterpart after putting in a bullish Piercing Line candlestick pattern. Near-term resistance is in the 1.0694-1.0700 area, marked by a trend line set from September 2012 and the 23.6% Fibonacci retracement. A break above that on a daily closing basis exposes the 38.2% level at 1.0749. Alternatively, a reversal below the 14.6% Fib expansion at 1.0643 clears the way for a challenge of the 23.6% mark at 1.0613.
On one hand, a pullback over the past three days has put prices squarely at support without a defined bullish reversal, making us leery to enter long. On the other, the upside implications of the Piercing Line pattern remain intact. We will opt to stand aside for now until greater clarity emerges.
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Daily Chart – Created Using FXCM Marketscope 2.0
— Written by Ilya Spivak, Currency Strategist for DailyFX.com