Birmingham , UK

Canadian Greenback Technical Outlook Week Forward: USD/CAD Bounce Faces Subsequent Check

canadian-greenback-technical-outlook-week-forward:-usd/cad-bounce-faces-subsequent-check

Canadian Greenback, Majors-Based mostly CAD Index, USD/CAD, Hammer – Weekly Technical Outlook

  • Canadian Greenback noticed a combined week versus main friends
  • Majors-based CAD index exhibits Loonie at key resistance
  • USD/CAD outlook pending on motion round trendline

Majors-Based mostly Canadian Greenback Index Evaluation – the Broader CAD Image

Beneath is a weekly chart of a majors-based Canadian Greenback index, which averages CAD in opposition to the US Greenback, Japanese Yen, British Pound and Euro. When the index rises, this represents the Loonie broadly gaining in worth in opposition to its main counterparts. Wanting again, CAD has usually been in an uptrend since March 2020, which was when the worldwide pandemic accelerated.

Beneficial properties have introduced the index in direction of a stage of resistance that has persistently held because the center of 2014. This may very well be a pivotal level, as breaking above might open the door to additional reversing the broader downtrend that CAD noticed from 2012 by means of the tip of 2015. A flip decrease then again would place the give attention to a rising trendline from 2020 – crimson parallel traces on the chart under.

Canadian Dollar Technical Outlook Week Ahead: USD/CAD Bounce Faces Next Test

Chart Created in TradingView

USD/CAD Technical Outlook – Impartial

The Canadian Greenback has been lately struggling in opposition to the US Greenback. In March, USD/CAD broke below a rising trendline from Might 2021, opening the door to extending losses in direction of lows from October. Since then, a spread of help has been established between 1.2403 and 1.2473. The pair additionally left behind a Hammer candlestick sample.

The latter is an indication of indecision, which may precede reversals after sometimes forming throughout a downtrend. Since then, there was upside affirmation, undermining the breakout below rising help. Curiously, USD/CAD was unable to rise again above the trendline, nonetheless leaving the latter in play. A flip decrease might place the give attention to the vary of help.

Falling below the latter would shift the outlook bearish, exposing the 1.2253 – 1.2308 help zone. Additional taking out that zone would expose lows from Might 2021, making for a spread of help between 1.2007 and 1.2046. Within the occasion costs rise again above the rising trendline, that will shift the outlook bullish, inserting the give attention to present 2022 peaks.

Canadian Dollar Technical Outlook Week Ahead: USD/CAD Bounce Faces Next Test

Chart Created in TradingView

— Written by Daniel Dubrovsky, Strategist for DailyFX.com

To contact Daniel, use the feedback part under or @ddubrovskyFX on Twitter

DailyFX gives foreign exchange information and technical evaluation on the tendencies that affect the worldwide foreign money markets.

Leave a comment