Canadian Dollar: USD/CAD (CAD=X) attention now shifting to Canadian inflation and US retail sales data
USD/CAD comes into focus following another robust Canada jobs report with attention now shifting to Canadian inflation and US retail sales data on deck next week. Spot USD/CAD prices threaten to continue drop seeing that the currency pair plunged beneath its uptrend line extended from the higher monthly lows printed back in July and August.
This area is also highlighted by the mid-point retracement of USD/CAD’s recent bullish leg. With crude oil price outlook becoming more optimistic, the US Dollar could fall further relative to its Canadian counterpart given the generally inverse relationship between oil prices and USD/CAD, which is illustrated above.
Also, the RSI and MACD suggest that selling pressure in spot USD/CAD is picking up and could drive prices toward the 61.8% Fib and September lows. Though spot prices did recover some downside before Friday’s close and is currently treading water around confluence at the 1.3200 handle.
Overall, the bias in prices is: Sideways.
The projected upper bound is: 1.33.
The projected lower bound is: 1.31.
The projected closing price is: 1.32.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 white candles.
A bullish harami occurred (where the current small white body is contained within an unusually large black body). During a downtrend (which appears to be the case with FOREX CAD=) this pattern implies an end to the decline as the bears appear to have exhausted themselves.
During an uptrend the bullish harami pattern is bearish as the bears appear to be gaining strength as the bulls weaken.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 21.0046. This is not an overbought or oversold reading. The last signal was a sell 4 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 41.81. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 71 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -135.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 3 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 1 period(s) ago.
Rex Takasugi – TD Profile
FOREX CAD= closed up 0.001 at 1.320. Volume was 100% below average (consolidating) and Bollinger Bands were 36% narrower than normal.
Open High Low Close Volume___
1.320 1.320 1.319 1.320 157
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 1.33 1.33 1.33
Volatility: 7 6 6
Volume: 62,492 69,693 86,526
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FOREX CAD= is currently 0.6% below its 200-period moving average and is in an upward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of CAD= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on CAD= and have had this outlook for the last 7 periods.