USDCAD: Still aiming lower

Intermediate
  • The Bank of Canada were in play in the middle of last week with a meeting in which they left their interest rates unchanged as expected, but with a more upbeat outlook for the global economy than expected by Forex markets.
  • This sent the USDCAD Forex rate lower (a stronger Canadian Dollar).
  • The more positive tone for Canadian Dollar versus the US Dollar was somewhat undone on Friday, however, after the US and Canadian Employment reports.
  • But our short-term bias remains negative for the USDCAD currency pair.

USDCAD day trade outlook

A Monday selloff to push below 1.3259 support, to try to dismiss Friday’s rally (after the US and Canadian Employment reports but to stall at the 1.3278 level, at 1.3270), to retrain into negative pressures from last Thursday’s probe through key 1.3186/76 supports after Wednesday’s plunge after the Bank of Canada interest rate decision (for a Double Top pattern), to keep risks lower for Tuesday.

  • We see a downside bias for 1.3218; break here aims for 1.3203/00 and maybe 1.3168 and 1.3154/53.
  • But above 1.3270/78 opens risk up to key 1.3328.

USDCAD intermediate-term outlook

The early December push below 13176 set an intermediate-term bear trend.

Downside risks: We see a downside risk for 1.3107, 1.3010/00 and 1.2795 and 1.2527.

What changes this? Below 1.3328 shifts the intermediate-term outlook straight to an intermediate-term bear theme.

4 Hour USDCAD Forex Chart

USDCAD chart

Steve Miley

Editor in chief

Steve Miley has 29 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Market Chartist, the Editor-in...continued

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