USD/CAD (1.1641)

The Loonie, better known as the USD/CAD Forex pair has been on a nice recovery higher as of late. This rise looks threatened by the emergence a Dark Cloud Candlestick, visible on the below daily MT 4 chart. This bearish reversal formation is still waiting to be confirmed with a daily close lower. If this happens then this market would be in danger of a correction lower. With that said, there would be renewed selling interest near 1.1459/58. This technical support level is a former resistance level turned support.

Let’s now look at the below 4 hour chart. We see a string of Dojis around the key technical handle of 1.16. This indicates sellers are hesitating dampening our view of a pullback, evident on the above daily chart. As of right now, I would need to see a move below 1.16 to indicate seller have traction in the USD/CAD. For now, my trading strategy is flat. We are too close to a support level to enter a short trade. Timing for that is not right from a risk to reward perspective. There are also no clear bullish reversal signals to warrant a long trade.

Trading Strategy: Flat

As always, trading strategies are educational in nature and do not constitute trade advice. Always perform your own technical analysis to support my conclusions before placing a trade.