USDCAD bears stepped in again at the 32.8% retracement of the fall from December implying that this is the first leg of a new flow to the downside. This implies that the time has come to start looking for value areas to book partial profits in this first wave down.
Drawing a fib for the entire 2018 rally we can see 1.3127 (32.8%) is likely to offer some support. Removal of this is needed to reassert any downside bias and negate the possibility of a temporary bottom forming. If we break below 1.3127 (not expected this quarter) here can unlock the door for a move back towards the January lows at 1.3180.
To the upside, resistance is initially seen at 1.333 and 1.337. Beyond here is necessary in Q1 to turn our broader outlook from sell to neutral. Our view remains that we will start to see some relief in the coming days as bears unwind their shorts and take profits off the table after a monstrous move this quarter.
To put simply we have 1.336 capping the upside and support at 1.312 ... so a wide range with opportunities on the both sides if you can stay sharp.
Best of luck all.
Drawing a fib for the entire 2018 rally we can see 1.3127 (32.8%) is likely to offer some support. Removal of this is needed to reassert any downside bias and negate the possibility of a temporary bottom forming. If we break below 1.3127 (not expected this quarter) here can unlock the door for a move back towards the January lows at 1.3180.
To the upside, resistance is initially seen at 1.333 and 1.337. Beyond here is necessary in Q1 to turn our broader outlook from sell to neutral. Our view remains that we will start to see some relief in the coming days as bears unwind their shorts and take profits off the table after a monstrous move this quarter.
To put simply we have 1.336 capping the upside and support at 1.312 ... so a wide range with opportunities on the both sides if you can stay sharp.
Best of luck all.
Comment:
Just as expected, profit taking place and bulls stepping in.
