USD/CAD Bearish Engulfing Pattern Warns Of A Correction

By DailyFx | August 22, 2014 AAA

DailyFX.com -

Talking Points

  • NZD/USD Technical Strategy: Sidelines Preferred
  • Piercing Line May Once Again Struggle To Find Follow-Through
  • Morning Star On H4 Offered An Early Hint At A Recovery

NZD/USD is probing back above the critical 84 US cent barrier with a Piercing Line formation in its wake. Yet the key reversal pattern awaits confirmation from a successive up-day before being validated. Further, some skepticism over the potential for a more sustained recovery for the pair may be warranted given the last such formation saw a lackluster response.

NZD/USD: Recovery May Prove Limited With Downtrend Intact

USD/CAD Bearish Engulfing Pattern Warns Of A Correction

Daily Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

A textbook Morning Star formation on the four hour chart offered an advance indication of an intraday recovery for the Kiwi. However, the pair’s ascent has encountered some selling pressure at the 0.8420 barrier with a Shooting Star now forming. The close of the current candle and a successive down-period would be required to confirm the bearish signal and open the door to a retreat on 0.8343/5.

NZD/USD: Morning Star Rises In Intraday Trade

USD/CAD Bearish Engulfing Pattern Warns Of A Correction

Four Hour Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

By David de Ferranti, Currency Analyst, DailyFX

Follow David on Twitter: @Davidde

To receive David’s analysis directly via email, please sign up here.

Learn how to read candlesticks to help identify trading opportunities with the DailyFX Candlesticks Video Course.

comments powered by Disqus
Related Forex Analysis
  1. USD/JPY crashes below 106.50, more downside in store
    Forex News

    USD/JPY crashes below 106.50, more downside in store

  2. Trading Video: Is the S&P 500 Rebound, VIX Retreat a Trend or Interlude
    Forex News

    Trading Video: Is the S&P 500 Rebound, VIX Retreat a Trend or Interlude

  3. EUR/USD bulls wake up and drive pair above 1.2800
    Forex News

    EUR/USD bulls wake up and drive pair above 1.2800

  4. Strategy Video: Which is the Better Breakout Candidate - AUDUSD or EURJPY?
    Forex News

    Strategy Video: Which is the Better Breakout Candidate - AUDUSD or EURJPY?

  5. AUD/USD Range Endures With Clearer Cues From Candlesticks Desired
    Forex News

    AUD/USD Range Endures With Clearer Cues From Candlesticks Desired

Trading Center