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Talking Points:

  • USD/CAD Technical Strategy: Flat
  • Support: 1.0828-50 (23.6% Fib exp., double bottom?), 1.0782 (38.2% Fib exp.)
  • Resistance: 1.0892 (14.6% Fib exp.), 1.0941 (May 21 high)

The US Dollar continued to weaken against its Canadian namesake after faltering at resistance above the 1.09 figure. Sellers are within striking distance of pivotal support in the 1.0828-50 area, marked by the 23.6% Fibonacci expansion and a would-be double bottom. A break below this barrier on a daily closing basis initially exposes the 38.2% level at 1.0782. Alternatively, a reversal back above the 14.6% Fib at 1.0892 opens the door for a challenge of 1.0941, the May 21 high.

Prices are too close to support to justify a short position from a risk/reward perspective. On the other hand, the absence of a confirmed bullish reversal signal warns against taking up the long side. We will remain flat for now.

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USD/CAD Technical Analysis – Double Bottom Vulnerable

Daily Chart - Created Using FXCM Marketscope 2.0

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