USD/CAD Decline Tests 1.0070 Support
- Daily and 4H: The USD/CAD’s rally attempt to test the 1.02 powerline was rejected today, with a big boost from the Canadian retail sales and inflation data, which all pointed to an economy that is starting to heat up.
- MA orientations on both remind that the market is in bearish mode. The market tested the SMA50 in the 4H time-frame and there was clear resistance.
- The stochastic shows bearish momentum – The daily showing a hold in the oversold zone, and the 4H shows the momentum staying bearish after a very short-term rally attempt.
- 1H: The 1H time-frame shows the dramatic decline in the near-term after the start of the US session. Note that the completed retracement rally was a zig zag with a 2-wave A structure and a 3-wave C structure.
- The wave count is not clear to me here , but the structure suggests that the retracement rally is over, as price action clearly showed.
- A break below 1.0070 spells the test of 1.00, and the strength of this morning’s decline adds to this probability.
