The USDCAD continued to drop after a bearish breakout of the bottom triangle trend line and its exposed to more downside risks. On April 17 the meeting of OPEC and Russia will be held to confirm oil production cut backs. So far they have agreed to cut backs as they control 75% of world oil supply. Generally that is good for oil and oil price could keep climbing. Remember CAD is positively correlated to OIL, so OIL up CAD up too, and that means USDCAD down.
Technically we see a symmetrical triangle downside broken with 2 potential POCs. POC 1 is 1.2840-1.2855 zone (L4 previous breakout point, lowest triangle swing point, 23.6) while POC2 is 1.2910-30. (L3,38.2,lower trend line point). Target is 1.2732 and the break of 1.2732 will expose 1.2562 weekly target. I have also included a weekly chart snap shot (top right corner) that confirms my view.
Have in mind that USDCAD is generally OIL driven so any change in the fundamental view for OIL could reflect on USDCAD too. Technically it should remain below the triangle to confirm bearish bias and targets.
The analysis and the article presents Nenad's opinion. Remember, financial trading is highly speculative & may lead to the loss of your funds. Proper risk management is the Holy Grail of trading.
Recommended Content
Editors’ Picks
EUR/USD clings to gains above 1.0750 after US data
EUR/USD manages to hold in positive territory above 1.0750 despite retreating from the fresh multi-week high it set above 1.0800 earlier in the day. The US Dollar struggles to find demand following the weaker-than-expected NFP data.
GBP/USD declines below 1.2550 following NFP-inspired upsurge
GBP/USD struggles to preserve its bullish momentum and trades below 1.2550 in the American session. Earlier in the day, the disappointing April jobs report from the US triggered a USD selloff and allowed the pair to reach multi-week highs above 1.2600.
Gold struggles to hold above $2,300 despite falling US yields
Gold stays on the back foot below $2,300 in the American session on Friday. The benchmark 10-year US Treasury bond yield stays in negative territory below 4.6% after weak US data but the improving risk mood doesn't allow XAU/USD to gain traction.
Bitcoin Weekly Forecast: Should you buy BTC here? Premium
Bitcoin (BTC) price shows signs of a potential reversal but lacks confirmation, which has divided the investor community into two – those who are buying the dips and those who are expecting a further correction.
Week ahead – BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.