In recent sessions, USD/CAD stripped away remaining orders around 1.34 and clocked highs at 1.3438. Assuming we establish footing north of 1.34, a revisit of 1.3450 may be in store, a level which held price action lower last Friday. It might also interest some traders to note the relative strength index (RSI) is seen hovering just south of overbought ground.
The US dollar index remains vulnerable, giving up 97.00 and testing lows at 96.65, amid plummeting US Treasury yields on Thursday. BoC Governor Poloz also took to the stage, stating the bank is ready to cut rates further if needed to support growth and keep inflation on target.
Weekly price has buyers and sellers squaring off between resistance at 1.3434, the 2017 yearly opening level, and trend line resistance-turned support, from the high 1.3664. A break of the said resistance positions Quasimodo resistance at 1.3520 in the firing range. By the same token, daily price has the current weekly resistance also in play at 1.3434, while daily support resides around 1.3327.
Intraday, buy stop-liquidity is likely consumed above 1.34, perhaps encouraging moves to 1.3450ish today. 1.34, if retested as support, therefore, may deliver a platform for potential long opportunities. Longer term, though, we face weekly resistance at 1.3434, despite price simultaneously holding off trend line resistance-turned support.
So, in a similar tone to Thursday’s analysis, the technical picture, particularly weekly flow, offers an indecisive tone right now, and may cause a bounce in either direction, defiling otherwise sound intraday setups.
Disclaimer: The information contained in this material is intended for general advice only.