Buying the Pullback in USD/CAD
[[USD/CAD]] was pretty bearish during most of October, as Oil prices were climbing higher after Saudi Arabia restored the production facilities pretty quickly following the attacks. But, the decline stopped above 1.30, which has become a solid support area down there.
The price started reversing higher on Tuesday and on Wednesday, this pair surged higher as the CAD dropped down after the Canadian GDP report came in pretty soft. Although, the climb stalled at around 1.32 and since then, USD/CAD has been trading sideways.
The area below 1.32 seems to have turned into a resistance zone for this pair now. This week this pair has been sort of bullish, but the resistance held once again and reversed the price down this morning, as the sentiment in financial markets improved.
But, the pullback is complete now on the H1 chart, as stochastic indicator shows. the 100 SMA (green) which used to be resistance for USD/CAD has turned into support and it is holding the decline today. Other MAs are also waiting to provide support below. The previous candlestick closed as a pin which is a reversing signal, so the chart setup points to a bullish reversal. We decided to buy, so we are long on this pair now.
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