By IFCMarkets
Hello, dear traders. Today we are going to look into the US dollar against the Canadian dollar chart pattern. Deep corrective move from support at 1.0620 eventually drew a resistance line at 1.0985 which is a more than 2–month high and extended in sideways trading. The falling trend line as we can see has been long before breached signifying the bullish weakness. Currently the Simple Moving Averages are below prices providing an extra support and together with the rising trend line suggest that upside bias is strong.
Furthermore, at the below chart we can see the daily volumes of futures and options traded on the Chicago Mercantile Exchange. We can see that during the recent trading sessions with the currency pair being in range the volume of trading is mostly steady. The latter indicates that the bulls and bears are of equal power at the time being. It is likely that the range could develop to a “flag” trading pattern which is a continuation pattern in technical terms.
Looking at the oscillators, the Stochastic has retraced from the overbought zone and that provides the chance to prices to continue their upward path. The MACD is in positive ground and the OsMA is gradually falling suggesting weakness. In our opinion, chances are slightly favoring the continuation of previous upside structure. However, that should be confirmed by a valid breach of the upper boundary at 1.0985. A break of that level coupled by a high volume of trading is considered valid. Alternatively, should the USDCAD prices penetrate the lower boundary at 1.0903 that could indicate reversal of the rising development and chances would favor downside trajectory.
Market Analysis provided by IFCMarkets