USD/CAD

USD/CAD: instrument consolidated

Current trend, Yesterday, the USD/CAD pair dropped significantly, departing from local highs renewed the day before.

In the morning, the instrument was trading under the influence of European news. Investors monitor the results of the negotiations of the British Prime Minister Theresa May and the head of the European Commission Jean-Claude Juncker on the preparation of the EU Brexit summit, as well as the development of the situation around the Italian budget.

October US construction market data did not disappoint the market. Building Permits decreased from 1.270 million to 1.263 million but exceeded investors' expectations (1.260 million), while Housing Starts rose from 1.210 million to 1.228 million.

In the afternoon, investors focused on US macroeconomic statistics. However, strong data on the dynamics of sales in the secondary housing market did not support USD significantly.

Support and resistance

On the daily chart, Bollinger bands are growing moderately. The price range is actively narrowing, reflecting the emergence of the ambiguous dynamics.

MACD is dropping uncertainly and is preparing to generate a sell signal (the histogram should be located below the signal line). On the contrary, Stochastic is growing and only slightly inclined to reverse horizontally.

It is better to wait until the signals are clear.

Resistance levels: 1.3262, 1.3300, 1.3317.

Support levels: 1.3200, 1.3169, 1.3125, 1.3100.

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Trading tips

Long positions can be opened after the rebound from the level of 1.3200 and the breakout of the level of 1.3230 with the targets at 1.3300–1.3317. Stop loss is 1.3200.

Short positions can be opened after the breakdown of the level of 1.3200 with the target at 1.3125 or 1.3100. Stop loss is 1.3230.

Implementation period: 2–3 days.

 

Scenario

Timeframe Intraday
Recommendation BUY
Entry Point 1.3235
Take Profit 1.3300, 1.3317
Stop Loss 1.3200
Key Levels 1.3100, 1.3125, 1.3169, 1.3200, 1.3262, 1.3300, 1.3317

 

Alternative scenario

 

Recommendation SELL STOP
Entry Point 1.3195
Take Profit 1.3125, 1.3100
Stop Loss 1.3230
Key Levels 1.3100, 1.3125, 1.3169, 1.3200, 1.3262, 1.3300, 1.3317

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