USDCAD Outlook: Loonie looks for extension of strong advance on signals of NAFTA talks continuation

Slobodan Drvenica Windsor Brokers

USDCAD

The USDCAD pair holds in narrow consolidation in early Wednesday's trading, following strong bearish acceleration in late Tuesday after Canada said was ready to make a concession to the US and continue talks about new NAFTA agreement. The pair was down 0.75% for the day, in the biggest one-day fall since 25 July and hit one-week low at 1.3042, where rising 100SMA contained fall. Bearish signal was generated on break and close below thin daily cloud and return below bear-channel upper trendline. Weakening momentum on daily chart keeps the downside vulnerable, however, daily MA's in mixed setup and flat RSI provide no clear direction signal. Near-term outlook is expected to remain negative while the price stays below daily cloud (spanned between 1.3077 and 1.3102), reinforced by falling 55SMA (1.3093). Break below 100SMA would open way towards next pivotal supports at 1.3016 (Fibo 61.8% of 1.2887/1.3226 ascend) and psychological 1.30 support. Conversely, close above 55SMA / daily cloud would ease bearish pressure and signal higher low.

Res: 1.3077; 1.3102; 1.3146; 1.3174
Sup: 1.3039; 1.3016; 1.3000; 1.2962

Interested in USDCAD technicals? Check out the key levels

1. R3 1.3284
2. R2 1.323
3. R1 1.3148
PP 1.3094
1. S1 1.3013
2. S2 1.2959
3. S3 1.2877

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

EUR/USD appears supported by the 200-day SMA, for now

Following an early pullback to multi-week lows near 1.1670, EUR/USD now manages to reclaim the 1.1700 region as the NA session draws to a close on Monday. The steep retracement in spot follows the equally strong move higher in the US Dollar, as investors continue to assess the geopolitical landscape in the wake of the US and Israel attacks on Iran.

GBP/USD hits new yearly lows near 1.3300

GBP/USD adds to the recent bearish tone, approaching to the key 1.3300 support to reach fresh YTD troughs against the backdrop of the robust performance of the US Dollar. Indeed, Cable’s decline comes amid the firm demand for the safe-haven space in the wake of the US and Israel attacks to Iran.

Gold clings to gains as US-Iran conflict continues to underpin safe-haven assets

Gold retains positive bias for the fifth consecutive day on Tuesday as rising geopolitical tensions in the Middle East continue to underpin safe-haven assets. However, a bullish US Dollar could keep the bullion below its highest level since late January, set on Monday, warranting caution before positioning for any further appreciation.