Canadian Dollar: USD/CAD (CAD=X) may have fallen to the base of the channel

Canadian Dollar: USD/CAD (CAD=X) may have fallen to the base of the channel

Canadian Dollar: USD/CAD (CAD=X) may have fallen to the base of the channel

The U.S. Dollar / Canadian Dollar exchange rate is trading at 1.3125 at the time of writing after falling to the base of its rising channel.

Mixed opinions about the outlook for the Canadian Dollar probably mean the main fundamental driver for the weakness was a decline in the U.S. Dollar rather than independent moves in the Canadian unit, following a general downgrade in expectations for U.S. growth in 2019.

Setting the debate over fundamentals aside, from a technical perspective we note the pair is now threatening to bearish breakout from the underside of its rising channel, and if it is successful it could probably fall all the way down to a target at circa 1.2800 initially, and probably even lower.

If the exchange rate falls through 1.3000 it would probably confirm a successful breakdown for USD/CAD and result in a test of a target set at 1.2800.

Many technical obstacles lie in the way of further weakness however, including several large moving averages, such as the 200-day, 50-week, 200-week, and 50-month.

Overall, the bias in prices is: Sideways.

By the way, prices are vulnerable to a correction towards 1.33.

The projected upper bound is: 1.34.

The projected lower bound is: 1.30.

The projected closing price is: 1.32.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 29 white candles and 20 black candles for a net of 9 white candles.

Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.

Momentum Indicators

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.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 40.8860. This is not an overbought or oversold reading. The last signal was a buy 1 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 44.07. 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 sell 25 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 -45. This is not a topping or bottoming area. The last signal was a buy 1 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 5 period(s) ago.

Rex Takasugi – TD Profile

FOREX CAD= closed up 0.007 at 1.320. Volume was 27% above average (neutral) and Bollinger Bands were 12% narrower than normal.

Open High Low Close Volume___
1.312 1.321 1.312 1.320 113,281

Technical Outlook
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 1.32 1.34 1.31
Volatility: 9 7 8
Volume: 110,385 88,899 87,821

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.

Summary

FOREX CAD= is currently 0.5% above its 200-period moving average and is in an downward 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 bearish on CAD= and have had this outlook for the last 21 periods.

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