USDCAD is trading somewhat sideways today, consolidating below a major level of resistance. The pair certainly could break above given the strength of the greenback across the board in recent days. However, should resistance hold or not will be key in understanding the direction of this pair going forward.
The weekly chart below shows the gravity of the current resistance level, which dates back to the back end of 2011. The level of 1.6 represents the price around which the red descending trend-line meets today’s candle. Given that this is also a notable number, there is further resistance around this level. One sign that there could be a possible break of this trend-line comes in the form of the CCI indicator which is today attempting to break the green descending trend-line. This could point to a possible upside strength which brings into question the possibility of an upside break.
The four hour chart shows the pair has seen flag and pennant formations on the move up to the current price level. This appears to be occurring again today, where the 1.6 level represents the upper threshold of the most recent flag. Should we see this manage to break out and close above this level, I would be feeling very bullish for the pair going forward. However, until this occurs, I expect to see a pullback at this key level.
About Joshua Mahony
Joshua Mahony is Research Analyst at Alpari UK. Having joined in 2012, Josh’s previous experience in the industry includes time spent on the trading floor at Barclays Capital and working for Deutsche Bank in New York for a year. Originally coming from an economics background, Josh then traded equities in the wake of the 2007/2008 financial crisis. He is now turning that experience towards the forex markets. Josh writes market commentary that has featured on websites and publications including the Financial Times, Reuters, the Guardian, ABC News, CityAM, the Washington Post and the Miami Herald.
ليست هناك تعليقات:
إرسال تعليق