Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

USD/CAD - Invalidation of Breakout or Further Rally?

Currencies / Bitcoin Apr 28, 2017 - 06:33 PM GMT

By: Nadia_Simmons

Currencies

Earlier today, the greenback moved lower against the Canadian dollar, which pushed USD/CAD below the December high and the previously-broken resistance zone. Is it enough to trigger further deterioration?

In our opinion, the following forex trading positions are justified - summary:

EUR/USD: short (a stop-loss order at 1.1052; the initial downside target at 1.0521)
GBP/USD: none
USD/JPY: long (a stop-loss order at 107.62; the initial upside target at 111.16)
USD/CAD: none
USD/CHF: none
AUD/USD: none


EUR/USD

Looking at the charts, we see that although EUR/USD rebounded slightly yesterday, this "improvement" was very temporary and currency bears pushed the exchange rate lower earlier today. Thanks to this drop the pair came back under the March high, which means that our previous commentary on this currency pair is up-to-date:

(...) EUR/USD tested the strength of the upper border of the brown rising trend channel, the 61.8% Fibonacci retracement (both marked on the weekly chart) and the 112.8% Fibonacci extension (seen on the daily chart), which resulted in a comeback below the March high. Additionally, the sell signal generated by the RSI remains in place, supporting currency bears. On top of that, the CCI and the Stochastic Oscillator are very close to generating sell signals, which suggests that reversal and lower values of the exchange rate are just around the corner.

Very short-term outlook:  bearish
Short-term outlook: bearish
MT outlook: mixed
LT outlook: mixed

Trading position (short-term; our opinion): Short positions (with a stop-loss order at 1.1052 and the initial downside target at 1.0521) are justified from the risk/reward perspective. We will keep you informed should anything change, or should we see a confirmation/invalidation of the above.

USD/JPY

Quoting our previous commentary on this currency pair:

(...) the combination of the lower border of the brown declining trend channel and the lower line of the blue trend channel (both marked on the weekly chart) triggered a rebound, which took the exchange rate above the upper line of the brown declining trend channel seen on the daily chart. Earlier today, the pair moved a bit lower, which looks like a verification of the earlier breakout. If this is the case, we’ll see further improvement and a test of the green zone (marked on the daily chart in the coming days.

From today’s point of view, we see that the situation developed in line with the above scenario and USD/JPY reached our upside target yesterday. What’s next? Taking into account the green resistance zone and the current position of the daily indicators it seems that we may see a pullback in the coming days.

Nevertheless, when we zoom out our picture and take a closer look at the medium-term chart below, we see that the buy signals generated by the weekly indicators remain in cards, supporting currency bulls and further improvement.

Therefore, even if USD/JPY moves a bit lower in the very short-term perspective, we believe that higher values of the exchange rate are just a matter of time. This means that if the exchange rate breaks above the green zone, we’ll see (at least) a test of the upper border of the medium-term brown declining trend channel in the following days.

Very short-term outlook: bullish
Short-term outlook: bullish
MT outlook: mixed
LT outlook: mixed

Trading position (short-term; our opinion): Long positions (with a stop-loss order at 107.62 and the initial upside target at 111.16) are justified from the risk/reward perspective. We will keep you informed should anything change, or should we see a confirmation/invalidation of the above.

USD/CAD

On the daily chart, we see that although USD/CAD broke above the December high and the orange resistance zone, currency bulls didn’t hold gained levels, which resulted in a pullback earlier today. Thanks to this move, the pair invalidated the earlier breakout, which is a negative development - especially when we factor in the current position of the daily indicators. Nevertheless, this event will be more bearish and reliable only if USD/CAD closes today’s session under the previous peak and the orange zone.

Very short-term outlook: mixed
Short-term outlook: mixed
MT outlook: mixed
LT outlook: mixed

Trading position (short-term; our opinion): No positions are justified from the risk/reward perspective at the moment.

Thank you.

Nadia Simmons
Forex & Oil Trading Strategist
Przemyslaw Radomski
Founder, Editor-in-chief

Sunshine Profits: Gold & Silver, Forex, Bitcoin, Crude Oil & Stocks
Stay updated: sign up for our free mailing list today

* * * * *

Disclaimer

All essays, research and information found above represent analyses and opinions of Nadia Simmons and Sunshine Profits' associates only. As such, it may prove wrong and be a subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Nadia Simmons and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Nadia Simmons is not a Registered Securities Advisor. By reading Nadia Simmons’ reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Nadia Simmons, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in