Canadian Dollar: USD/CAD (CAD=X) is finding itself up against a formidable area of resistance
USD/CAD has had a strong rally to start the year, but it is about to get tested. The pair is finding itself up against a formidable area of resistance as a new week rolls around, and could determine whether we are finally in for a breakout, or if it will be more of the same range activity.
Running down from the 2016, June, and September highs are trend-lines all within 100 pips of one another. Furthermore, the 200-day moving average is also in play at the moment. If the past years’ worth of price action is indicative of how things will play out we will see a turn lower here.
However, with last year having been such an unusually low year of volatility, resulting in the smallest trading range since 1996, we are due for a breakout of some sort. This could mean the aforementioned levels are hurdled in the days/weeks ahead. To do so clearance well into the 13300s will be needed.
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 black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 24 white candles and 26 black candles for a net of 2 black candles.
A hammer occurred (a hammer has a long lower shadow and closes near the high). Hammers must appear after a significant decline or when prices are oversold to be valid. When this occurs, it usually indicates the formation of a support level and is thus considered a bullish pattern.
A hanging man occurred (a hanging man has a very long lower shadow and a small real body). This pattern can be bullish or bearish, depending on the trend. If it occurs during an uptrend (which appears to be the case with FOREX CAD=) it is called a hanging man line and signifies a reversal top. If it occurs during a downtrend it is called a bullish hammer.
A long lower shadow occurred. This is typically a bullish signal (particularly when it occurs near a low price level, at a support level, or when the security is oversold).
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 83.7503. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 2 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 66.98. 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 19 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 113.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 19 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 buy 17 period(s) ago.
Rex Takasugi – TD Profile
FOREX CAD= closed unchanged at 1.324. Volume was 100% below average (consolidating) and Bollinger Bands were 21% wider than normal.
Open High Low Close Volume___
1.324 1.324 1.323 1.324 277
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 1.32 1.31 1.32
Volatility: 4 5 5
Volume: 49,155 46,605 66,003
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 0.1% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect moderate flows of volume into CAD= (mildly bullish). Our trend forecasting oscillators are currently bullish on CAD= and have had this outlook for the last 8 periods.