USD/CAD breaks out to the downside
The USD/CAD forecast was precise. The pair broke out of the developed triangle down pattern to the downside. Moreover, the breakout has revealed additional patterns.
There are two newly mapped channel down patterns on the chart. One is a representation of the second one’s junior movement. By using these two patterns one can make future forecasts.
In the short term the pair should slightly surge to touch the upper trend line of the junior pattern. There it will have two possibilities. Either break the resistance or decline to reconfirm the lower trend line the dominant pattern.
There are two newly mapped channel down patterns on the chart. One is a representation of the second one’s junior movement. By using these two patterns one can make future forecasts.
In the short term the pair should slightly surge to touch the upper trend line of the junior pattern. There it will have two possibilities. Either break the resistance or decline to reconfirm the lower trend line the dominant pattern.
Comment:
Just as expected the US Dollar has extended its surge against the Canadian Dollar and revealed the trend lines of the dominating medium term pattern. In general, this analysis concentrates on the new information.
First of all it can be seen that there was a basis for the resistance of the new medium sized channel up pattern. The low levels of December 13 and 14 served as a base for the resistance line.
Secondly, the pair has made another rebound against the lower trend line of newly discovered pattern. That means that the pair is set to continue to surge in the short and medium term.
First of all it can be seen that there was a basis for the resistance of the new medium sized channel up pattern. The low levels of December 13 and 14 served as a base for the resistance line.
Secondly, the pair has made another rebound against the lower trend line of newly discovered pattern. That means that the pair is set to continue to surge in the short and medium term.
Comment:
Despite the slow start of Tuesday’s session, the US Dollar managed to strengthen against the Loonie and test the six-month high of 1.2907 by mid-session. The rate lingered slightly near this mark but was nevertheless pressured by bears to fall back down the combined support of the 200– and 100-hour SMAs.
This area, however, did not hold for long, as the Greenback fell to test another support of significance formed by the weekly and monthly PPs near the 1.2825 mark. It is expected that this area could stop any further decline.
Technical indicators favour appreciation within the following 24 hours. However, all three SMAs are likely to restrict the pair from an easy access to the aforementioned six-month high.
As a result, the rate could be located near the 55-hour SMA by mid-tomorrow.
Despite the slow start of Tuesday’s session, the US Dollar managed to strengthen against the Loonie and test the six-month high of 1.2907 by mid-session. The rate lingered slightly near this mark but was nevertheless pressured by bears to fall back down the combined support of the 200– and 100-hour SMAs.
This area, however, did not hold for long, as the Greenback fell to test another support of significance formed by the weekly and monthly PPs near the 1.2825 mark. It is expected that this area could stop any further decline.
Technical indicators favour appreciation within the following 24 hours. However, all three SMAs are likely to restrict the pair from an easy access to the aforementioned six-month high.
As a result, the rate could be located near the 55-hour SMA by mid-tomorrow.
Comment:
On Friday the USD/CAD rate jumped on the release of fundamental news. Namely, the Canadian GDP came in lower than expected by the average forecast. That caused a jump up to the resistance of the 55-hour SMA and the upper trend line of a descending channel pattern.
However, on Tuesday the currency exchange rate had retreated to trade back near the 1.27 level. By the middle of Tuesday’s trading session it was expected that the currency exchange rate will reach the support of the 1.27 mark. That level has held the rate from falling three times since the middle of last week.
However, on Tuesday the currency exchange rate had retreated to trade back near the 1.27 level. By the middle of Tuesday’s trading session it was expected that the currency exchange rate will reach the support of the 1.27 mark. That level has held the rate from falling three times since the middle of last week.
It was revealed that there is a dominant channel up pattern, whose support was touched together with the rest of the support lines. In accordance with that pattern a rebound should have broken the previously watched patterns.
Exactly that has occurred. Due to that reason the pair needs to be watched closely as new trend lines will be discovered.