USDCAD traded lower again in overnight Wednesday trade, marking an extension once again of the bear cycle that started Aug 5. The move down reinforces the current bearish condition. 1.3589, the Jul 11 low, has recently been cleared, strengthening a bearish theme. This sets the scene for an extension towards 1.3358, a Fibonacci projection. On the upside, initial firm resistance to watch is at 1.3617, last Friday’s intraday high.
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The recent impulsive rally in USDCAD has resulted in a break of 1.3792, the Jun 11 high, and a print above key resistance at 1.3846, the Apr 16 high. Conditions are overbought, however, a clear break of 1.3846 would strengthen the bull theme and pave the way for a continuation higher, towards 1.3899, the Nov 1 high ‘23 and a key resistance. Firm support lies at 1.3696, the 50-day EMA.
A sharp sell-off in AUDUSD last week reinforces a bearish theme and signals scope for a continuation. The move down has resulted in a break of support at 0.6576, the Jun 10 low. A resumption of the bear leg would pave the way for a move towards 0.6466, a Fibonacci retracement point. From a near-term perspective, the pair is oversold. A recovery would allow this condition to unwind. Key short-term resistance is seen at 0.6653, the 50-day EMA.