For USD/CAD, 1.3000 is more than a round number— Confluence Detector
In early May, the Technical Confluences Indicator showed that the USD/CAD would it hard to reach 1.3000 (USD/CAD to 1.30? Not so fast) and the pair indeed failed to do so. As the pair is very close t the round number, we see that there is much more to this level that a round number: it is also a dense cluster of resistance lines.
1.3000 is the confluence of the Bolinger-Band 15-m Upper, the BB 1h-Upper, the one-month high and the 4h high. Should the pair break higher, another convergence of levels awaits at 1.3024: the Pivot Point one-day Resistance 1, the Bolinger Band one-hour Upper, and the Pivot Point one-month Resistance 1.
On the downside, Dollar/CAD has support at 1.2950 which is the confluence of the Fibonacci 38.2% one-day. the Bolinger Band one-day Upper, the Simple Moving Average 200-15m and the SMA 50-1h. Further down, 1.2895 is the meeting point of the SMA 100-1h, the Fibonacci 38.2% one-week and the Pivot Point one-day Support 1.
Here is how it looks on the tool:
Confluence Detector
The Confluence Detector finds exciting opportunities using Technical Confluences. The TC is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.
This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. This means that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.
Author
Yohay Elam
FXStreet
Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.
