Strategy: Flat

Prices put in a Bearish Engulfing candlestick pattern below resistance at a falling trend line set from the June 4 high, hinting a move lower is ahead. Initial support lines up at 0.9743, the 23.6% Fibonacci expansion, with a break below that targeting the 38.2% level at 0.9654. Trend line resistance is now at 0.9870. Risk/reward considerations argue against entering a trade at current levels with prices so close to support and we will stand aside for now.

USDCAD_Candle_Pattern_Warns_of_Weakness_body_Picture_5.png, USDCAD: Candle Pattern Warns of Weakness
Daily Chart - Created Using FXCM Marketscope 2.0

Written by Ilya Spivak, Currency Strategist for Dailyfx.com

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Forex pairs in this Article » USD/CAD

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