Are You Ready To Sell USD/CAD Again?
Skerdian Meta • 2 min read
For quite a few years, USD/CAD used to trade in an uptrend, but lately, oil prices along with the Canadian dollar have stabilized. Over the last two months, this forex pair has slipped lower and now we are more than 7 cents down from the high a few of months ago.
Oil prices are one factor for the stabilization of the CAD, the other one being the BOC (Bank of Canada). The global economy has improved and so has the Canadian economy, so the BOC is starting to turn hawkish, like most of its peers.
So, USD/CAD has slipped lower and we have taken advantage of this smaller downtrend, opening short term sell forex signals now and again.
Last Thursday we opened a sell signal here which closed in profit on Friday. The reasons for this signal were the steep downtrend and the 20 SMA (grey) on the hourly chart. The price retraced up to the 20 SMA, which provided resistance.
The 50 SMA is providing resistance now
Remember that the stronger the trend the smaller the moving averages that come into play. Today the downtrend has slowed and a bigger moving average came into play, the 50 SMA (yellow).
This moving average has provided support all morning and it is doing so now, so we´re preparing to sell this forex pair, hence the get ready signal in USD/CAD.
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