USDCAD, Monthly
Looking at the longer term USDCAD chart (monthly) it is clear that prices have been in a very aggressive bull market for the last few years. The question going forward for traders is: when will this trend stop?
For the moment, the CAD continues to track the current oil price decline and since it is still unknown as to when the Oil sell-off will halt it’s decline, I’m not going to bet against the upward momentum of the USDCAD until clearer signs of a price reversal pop up.
Technically, USDCAD bullish momentum remains in overextended territory, in theory prices can remain overextended for very long periods, so I will discount the Stochastic for my monthly chart analysis and resort to the Fibonacci levels for price targets. The Fibo extension levels from March 2009 highs (1.3060) to the July 2011 low (0.94) price suggest that the current bullish momentum could take the USDCAD towards the 1.5280 (161.8% Fibo).
Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.
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