Talking Points
- USD/CAD Technical Strategy: Longs Preferred
- Bullish Engulfing Pattern Emerges Following Push Past 1.1000
- Breakout Of Critical Barrier Opens Run Towards 1.1270
USD/CAD has finally cracked the critical 1.0980/1.1000 ceiling which has yielded a Bullish Engulfing formation on the daily. While the pattern is technically classed as ‘reversal signal’ it may also offer an indication of building upside momentum. Alongside signs of an emerging uptrend this opens the door to an ascent on 1.1270. A daily close back below the breakout point would invalidate the signal and negate a bullish bias for the pair.
USD/CAD: Leaps Over 1.0980/1.1000 Ceiling Amid Bullish Signals
Daily Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here
The four hour chart reveals some signs of hesitation amongst traders as the pair loses momentum near the 1.1058 mark. Yet the lack of follow-through from a Shooting Star formation indicates the bulls are unprepared to relinquish their grip on prices at this point. In light of the context afforded by the daily, this leaves buying on an upside break preferred.
USD/CAD: Momentum Slows, Yet Bulls Remain In Control
4 Hour Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here
By David de Ferranti, Currency Analyst, DailyFX
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