In today's article on the pair of North American dollars, the main focus will be on the technical picture of this trading instrument. To complete the review and understanding of what is happening, we will start with the weekly chart.
Weekly
As noted in earlier articles on other currency pairs this week, the US dollar significantly strengthened against all major competitors in the June 14-18 trading session. This fate was not spared by the Canadian dollar, which declined significantly, and significant important changes were outlined on the weekly scale. As you can see, as a result of the strong growth shown by the pair last week, the quote managed to get out of the descending channel and close the trading of the past five days above its resistance line. All this may indicate a change in the downward trend. However, it is still necessary to fix it above the upper limit of the channel, which will confirm the truth of the breakdown. In this regard, the current weekly trading is of particular importance.
As you can see, the USD/CAD bears fundamentally disagree with this state of affairs and are currently making serious efforts to return the quote to the limits of the descending channel. The final results of the outcome of the struggle of the warring parties will be judged only after the closing of the weekly auction. In the meantime, let us briefly talk about the bullish and bearish prospects. As you can see, on the weekly chart, the blue Kijun line of the Ichimoku indicator provides strong resistance to attempts to continue the rise, so the USD/CAD bulls must pass up this line and consolidate above it. In turn, the bears on this instrument need to return the course to the limits of the channel and, at the same time, lower it below the red line of the Tenkan. Only the closing of weekly trading below this line will return the bears to control of the pair.
Daily
Looking at the daily chart, we again have to remind you that one closed candle over a particular broken barrier may not be enough to consider such a breakdown true. A typical example is an exit from the Ichimoku cloud and closing above only one daily candle, after which the quote again returns to the cloud. Today's attempts to return the price above the cut resistance line (black) of the descending channel are unsuccessful. However, it will be necessary to bring the course up again from the channel and the Ichimoku cloud.
If we turn to trade recommendations, the current situation is extremely difficult for making trading decisions. According to the author's personal opinion, it is most safe to buy from the depth (near 1.2250). However, if the pair is fixed within the channel, the exit from it will have to be considered false, which means that purchases will already be too risky. For sales, I recommend paying attention to the price zone of 1.2350-1.2400 and the price area of 1.2400-1.2450. Since the situation for USD/CAD is far from unambiguous, I recommend waiting for confirming candle signals on this or smaller charts before opening positions.
