Fibonacci Support Approaching For The USD/CAD
Shain Vernier • 1 min read
It has been a mixed bag for the USD to open the trading week. Losses against the Euro and British pound have been the highlights of the Monday session. Modest gains vs the Japanese yen and a muted Swiss franc have given Greenback bulls two small reasons for optimism. The USD/CAD has followed the early week trend, with pricing falling toward a key macro support level.
At press time, the Loonie has sustained trade under Friday’s low and is plodding south. If the selling continues, a buying opportunity may present itself later in the day.
In the event the USD/CAD closes negative, it will mark the third straight red candlestick on the daily chart. July has extended the negative sentiment of late June, with price seemingly on a collision course with the 1.3000 handle.
Here are the areas to watch for the remainder of the Monday session:
- Resistance(1): Bollinger MP, 1.3152
- Resistance(2): Daily SMA, 1.3190
- Support(1): 62% Macro Retracement, 1.3035
Bottom Line: As of press time, price is trading near the 1.3075 level. If we see a continued fall, then a buy from 1.3036 gives good location to the bull. Using an initial stop at 1.2994, this trade produces 42 pips when implementing a 1/1 risk vs reward management plan.
The optimal timing for this trade is before the Monday forex session close. However, the recommendation will remain valid until Wednesday’s BoC Interest Rate Announcements. If it hasn’t gone live by that time, pull the orders.