USD / CAD Technical Outlook
- USD / CAD finding little support from buyers
- Breaking trend-line support near 200-day MA
USD / CAD Technical Outlook: Looking to Trade Lower
USD / CAD grew sharply in August and fell just as hard, posting a monthly investment for the second month in a row. A larger image this suggests a sale, but even if the larger image doesn’t play as it looks, the short-term doesn’t look too strong either.
The recent decline of the 12950 level has found very minimal sponsorship from buyers even with a trend line close as support. The one-day rebound last week was followed by a weak price, which suggests we will soon see further weakness.
On the 4-hr chart a descending wedge is formed, which if broken will have the 200-day at 12536 (and decreasing) in play. If that happens, it should lead to the lowest levels since July 30th. The low then was 12422. It may act as a significant floor, then it may not – we will estimate price if it is labeled.
To make the image optimistic is a bit of work. A turn higher from here and over last week’s high at 12708 will be needed to get started. Depending on how this has developed, it may become clearer that a rally might develop, or it may not. At least it would be a warning to sellers to be careful.
A currently confirmed collapse below 12569 (a 4-hour closing candle below) will break the wedge and the 200-day period follows to see signs of further momentum pushing it.
Daily USD / CAD Chart
USD / CAD 4-hour chart
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— Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX