Overview:
The USD/CAD is to trade with bearish bias. It is undermined by negative USD sentiment; strong oil prices (Nymex crude settled $2.99 higher Wednesday at $106.52/bbl); increased investor risk appetite. The data to focus on: 12:30 GMT Canada May new-housing price index. Daily chart negative-biased as stochastics falling from overbought; MACD staged bearish crossover against its exponential moving average; bearish parabolic stop-and-reverse signal hit at 1.0459 Wednesday.
Trading recommendation:
The pair is trading below its pivot point. It is likely to trade in lower range as far as it remains below its pivot point. The short position is recommended with the first target at 1.0325 in view; the breach of this target will move the pair downward further and you should expect the second target at 1.0285. The pivot point stands at 1.042. In case the price moves in the opposite direction, returns from its support, and moves above its pivot point, then trading in higher range is the most favorable and buy position is recommended above its pivot with the first target at 1.047 and the second target at 1.052 .
Support levels:
S1 - 1.0325
S2 - 1.0285
S3 - 1.023
Resistance levels:
R1 - 1.047
R2 - 1.052
R3 - 1.055
