The USD/CAD in a bearish channel

fxstrategist

Corporal
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On the daily chart of the USDCAD we can see that the pair has been in a bearish channel since late June. Every time the pair tried to rally, the upper boundary of the channel kept the price to the downside. Now the USDCAD is at the 1.3000 level, which could act as support. Below the 1.3000 level, its next support could be the 200 day EMA (blue line) at the 1.2942 level. The lower trend line of the channel could hold the price of the USDCAD in case of a bearish breakdown below the 200 day EMA could also hold the price, but a better support below that moving average, is the 1.2852 level. On the other hand, in case the price bounces to the upside, the 1.3100 level may act as resistance and above that level, the 1.3200 level could also act as resistance. In the longer term, a better resistance is the peak at the 1.3387 level.

usdcad-d1-activtrades-plc.png
 
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The jump on the USDCAD takes the pair to the 1.3100 level and the 55 day EMA as shown on the follow up chart of the pair. The 1.3000 level may keep acting as support in the short-term, but in case of a breakout to the upside, the 1.3200 level may act as resistance.

usdcad-d1-activtrades-plc.png
 
The USDCAD bounces back down from the 1.3100 level, but the 1.3000 level may act as support and the pair may even stay oscillating between those two levels.
 
The USDCAD still has a good resistance at the 1.3200 level after breaking out of the bearish channel. To the upside, its next resistance could be the peak at the 1.3387 level. To the downside, the 1.3100 level may act as support in case of a pullback.

usdcad-d1-activtrades-plc.png
 
The USDCAD could not hold the 1.3200 level and bounces to the 1.3000 level where it finds a good support. From the current level, the pair may head in any direction, but it may try to visit its next support around the 1.2926 where we can find the 200 day EMA and the 55 week EMA.
 
The bearish channel on the USDCAD has been invalidated and the pair now completes five consecutive sessions between the 1.3000 level and the 55 day EMA at the 1.3060 level.

usdcad-d1-activtrades-plc.png
 
On the daily chart of the USDCAD we can see that after the bounce from the 1.2884 level, the pair reaches the 200 day EMA around the 1.2960 level. The moving average may act as a resistance, but a breakout of the 1.2960 level may form a double bottom pattern at the 1.2884 level. However, the confirmation line of the possible double bottom is at the 1.3200 level, which is relatively far away. Therefore, a visit to the 1.3200 level could take a few weeks. Below the 1.2884 level, its next support could be at the 1.2800 level.
 
The USDCAD rallies to the 1.3045 level, but it may find some resistance at the 1.3081 level if it continues rallying. To the bottom, the 55 and 200 day EMAs may act as support at the 1.2997 and 1.2955 levels, respectively.
 
The USDCAD breaks above the 1.3081 level and consolidates for a while around that zone, forming what it appears to be a pennant formation. From the current level, the USDCAD may continue higher towards the 1.3200 level. To the downside, the 1.3000 level may act as support, followed by the 1.2800 level.
 
The USDCAD consolidates around the 1.3100 level, but the daily lows are getting higher, signaling a possible bullish continuation. To the upside, the 1.3200 level could act as resistance.
 
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