There’s no doubt that the clear driver of yesterday’s price action was the Fed. The USD is under all sorts of pressure and as yet it’s tough to know how the market will react over for the rest of the week.
There was one thing that did catch my attention though. It was the strength of the USD/CAD versus a lot of other currencies. Looking at the chart, the support level around the 1.2800 mark held strong and limited a lot of the damage.
When we get a market that is strong (relatively so) in the face of weakness then to me that is bullish.
So that’s telling me that perhaps the CAD is weaker than many of the other major currencies. With that in mind, it does give me the confidence to predict a move back to the highs of the recent range at 1.2900.
We also have other options for some crosses featuring the CAD. At this stage, I’m more interested in seeing a rebound in the USD/CAD and a move to 1.2900.