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Talking Points:
- USD/CAD Technical Strategy: Flat
- Support: 1.2312, 1.2215, 1.2117
- Resistance: 1.2433, 1.2628, 1.2823
The US Dollar continued to build higher against its Canadian namesake having vaulted sharply upward following a surprise BOC rate cut. Near-term resistance is at 1.2433, the 76.4% Fibonacci expansion, with a break above that on a daily closing basis exposing the 100% level at 1.2628. Alternatively, a turn back below the 61.8% Fib at 1.2312 clears the way for a test of the 50% expansion at 1.2215.
Prices are too close to resistance to justify entering long from a risk/reward perspective. On the other hand, the absence of a defined bearish reversal signal suggests that taking up the short side is premature. With that in mind, we will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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