Overview::
USD/CAD is trading in lower range. It is undermined by negative USD sentiment; firmer commodity and oil prices (Nymex crude settled $1.17 higher Tuesday at $98.51/bbl). But USD/CAD losses are tempered by loonie sales in soft CAD/JPY cross amid increased investor risk aversion.
Technical comment:
Daily chart is negative-biased as stochastics is falling from overbought zone; MACD is staging bearish crossover against its exponential moving average; bearish parabolic stop-and-reverse signal was hit Tuesday.
Trading recommendation:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. A short position is recommended with the first target at 1.0645 in view; a breach of this target will move the pair further downwards to 1.067. The pivot point stands at 1.063. In case the price moves in the opposite direction, bounces back from support, and moves above its pivot point, the price is most favorably expected to move further to the upside. In that scenario a long position is recommended with the first target at 1.0585 and the second target at 1.0565.
Resistance levels:
1.0645
1.067
1.07
Support levels:
1.0585
1.0565
1.0545
