Buyers Pushing USDCAD Higher

by at FXTM.
Tran Dai Phat
Tran Dai Phat

The USDCAD currency pair on the Daily Chart has been following a downward path since 19 March 2020, having found resistance at the 1.46668 level. The formation of the Japanese candlestick reversal pattern known as Shooting Star Pattern signaled the very beginning of the downward bias.

The high prices attracted sellers who entered the market with short positions and as a result they have pulled the Loonie to lower levels, following a pattern of successively lower tops and lower bottoms.

Morning Star

Subsequently, the currency pair formed a Morning Star pattern near the support level of 1.38545 which hinted at the end of the downtrend and the potential beginning of a rally.

Upon applying Technical analysis on the price chart, one can see that the last Japanese candlestick of Morning Star pattern managed to close above the 10-period Exponential Moving Average line, a fact that also signals an upward direction and the bullish bias in the market.

Additionally, the Relative Strength Index Oscillator registers values above the fifty line, which subsequently confirms the positive sentiment in the market.

Both technical indicators, as well as the Japanese candlestick reversal pattern, are in agreement in terms of the pair’s upward bias.

Furthermore, the current price is trading above the downward trend line, which also implies that demand is greater than supply.

Fibonacci

Applying the Fibonacci Retracement tool to the high price of the Bullish Japanese candlestick at the price of 1.41314 and dragging it down to the low price of the pattern at the price of 1.38545, three price targets may be calculated:

  • The first price target is estimated at 1.44083 (200%)
  • The second price target is seen at 1.46852 (300%)
  • The third price target is projected at 1.49621 (400%)

Of course, it remains to be seen whether the crowd psychology as well as the buyers’ pressure will manage to maintain the control of the market and pull USDCAD currency pair higher.

USDCAD Daily 21Apr

For more information, please visit: FXTM

Disclaimer: This written/visual material is comprised of personal opinions and ideas. The content should not be construed as containing any type of investment advice and/or a solicitation for any transactions. It does not imply an obligation to purchase investment services, nor does it guarantee or predict future performance. FXTM, its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness of any information or data made available and assume no liability for any loss arising from any investment based on the same.
Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 81% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Sorry, there are no matching brokers for your criteria and location (United States). You can see the list without the location filter.

Go to the full list of brokers