USD/CAD: consolidation near local lows
Current trend
At the end of the week, the Canadian Dollar has been trading mixed against the US Dollar. Having reached new local lows on Wednesday, the pair has started correcting up amid the statements made by the Federal Reserve officials.
The results of the recent Bank of Canada monetary policy meeting had a high impact on the market. However, it should be noted the Canadian currency started strengthening some time after the results were released.
As expected, interest rates were kept unchanged at 0.5% as commodity markets instability affects the process of Canada’s economic recovery. At the same time, the regulator revised up its forecast for 2016 that can be explained by the recent growth in oil prices.
Support and resistance
Bollinger Bands on the daily chart is directed down while the price range is getting narrower. MACD is slightly growing and still keeping its sell signal. Stochastic is in the oversold zone and trying to turn up indicating the possibility of an upward correction in the short term.
The indicators recommend waiting for clearer trading signals.
Support levels: 1.2800, 1.2744 (13 April low), 1.2700 (mid-July 2015 level), 1.2650.
Resistance levels: 1.2857, 1.2897 (14 April high), 1.2952, 1.3000 (11 April level), 1.3037, 1.3100, 1.3180 (7 April high), 1.3218 (5 April high), 1.3300.
Trading tips
Long positions can be opened after the price rebounds at the level of 1.2800 (with appropriate indicators signals) with the target at 1.3000 and stop-loss at 1.2740.
Short positions can be opened after the level of 1.2744 is broken down with targets at 1.2650, 1.2600 and stop-loss at 1.2800.
At the end of the week, the Canadian Dollar has been trading mixed against the US Dollar. Having reached new local lows on Wednesday, the pair has started correcting up amid the statements made by the Federal Reserve officials.
The results of the recent Bank of Canada monetary policy meeting had a high impact on the market. However, it should be noted the Canadian currency started strengthening some time after the results were released.
As expected, interest rates were kept unchanged at 0.5% as commodity markets instability affects the process of Canada’s economic recovery. At the same time, the regulator revised up its forecast for 2016 that can be explained by the recent growth in oil prices.
Support and resistance
Bollinger Bands on the daily chart is directed down while the price range is getting narrower. MACD is slightly growing and still keeping its sell signal. Stochastic is in the oversold zone and trying to turn up indicating the possibility of an upward correction in the short term.
The indicators recommend waiting for clearer trading signals.
Support levels: 1.2800, 1.2744 (13 April low), 1.2700 (mid-July 2015 level), 1.2650.
Resistance levels: 1.2857, 1.2897 (14 April high), 1.2952, 1.3000 (11 April level), 1.3037, 1.3100, 1.3180 (7 April high), 1.3218 (5 April high), 1.3300.
Trading tips
Long positions can be opened after the price rebounds at the level of 1.2800 (with appropriate indicators signals) with the target at 1.3000 and stop-loss at 1.2740.
Short positions can be opened after the level of 1.2744 is broken down with targets at 1.2650, 1.2600 and stop-loss at 1.2800.