FX.co ★ Technical analysis of USD/CAD for 2010/07/16

Support levels: 1.0292, 1.0141, 1.0100.
Resistance levels: 1.0455, 1.0681, 1.0858.
The USD/CAD currency pair demonstrated a sharp rebound to the resistance level of 1.0455. Nevertheless, USD/CAD can fall to the mark of 1.0183 with the next target at 1.0141. However, if the resistance level of 1.0455 is breached, it will mean that the pullback from 1.0681 is finished and an upward motion should be expected.
As it is seen on a 4-hour chart, the movement of USD/CAD is developing in the form of triangle, therefore, an upward recoil should be awaited around 1.0141. If this support level is broken, USD/CAD will decline to 0.9930. On the other hand, we can suppose that a model “Head and shoulders” is shaping. The breakthrough of the “neck” line will cause a drop to 0.9950 – 0.9930 area.
In mid-term outlook, apparently USD/CAD formed a bottom at 0.9930. Also, considering bullish divergence at daily and weekly MACD, the view of the pair remains bullish amid the reversal of downward trend from 1.3063. It is expected that USD/CAD will go up to Fibonacci correctional level of 38.2 from 1.3063 to 0.9929 on 1.1126 with the next target at Fibonacci correctional level of 61.8 on 1.1866.