2016-07-08 12:35:13

Review and dynamics

After reaching the annual lows at the level of 1.2525 in April, since June the pair USD/CAD has been moving in the range of 1.2635 (Fibonacci 50% to the rise since the beginning of July 2014 and the level of 1.0650) and 1.3100 (ЕМА200, ЕМА144, upper line of the descending channel on the daily chart and Fibonacci 38.2%).

From the point of view of trading strategy based on Fibonacci levels, these are the key levels. In case of breakout of the level of 1.2635 a chance of the trend reversal will increase, as the trend can change from upward to downward.
The levels of 1.3100 and 1.3680 (Fibonacci 23.6%) are important levels, and if the price reaches these levels, uptrend, which started in July 2014, will resume.

Our opinion

On 4 hour, daily, weekly charts the indicators OsMA and Stochastic give buy signals. As long as the price remains at the level above 1.2930 (ЕМА200, ЕМА144 on 4-hour chart and ЕМА50 on the daily chart), it is advisable to open long positions with the nearest target at the level of 1.3100.
In case of breakout of the level of 1.2930, it will be preferable to open short-term short positions with targets at support levels 1.2845, 1.2730 and 1.2635.

However, long positions are more favourable amid the continuing decline in oil prices.

If today's data on the US NFPR will be positive, the price can easily break out resistance level of 1.3100 and go to the level of 1.3680 with the nearest short-term targets at the resistance levels of 1.3185 and 1.3300.
If the data on the US labor market is weak, it will weaken the USD dollar in the currency market.

Support levels: 1.2930, 1.2880, 1.2845, 1.2730, 1.2635 and 1.2525.
Resistance levels: 1.3100, 1.3185, 1.3200, 1.3300, 1.3400, 1.3500 and 1.3680.


Trading tips
Buy Stop: 1.3020. Stop-Loss: 1.2980. Take-Profit: 1.3085, 1.3100, 1.3185, 1.3300 and 1.3400.
Sell Stop: 1.2970. Stop-Loss: 1.3010. Take-Profit: 1.2930, 1.2845, 1.2800, 1.2730, 1.2635, 1.2525 and 1.2500.

Above the level of 1.2930
Above the level of 1.2930

In the range of 1.3100 – 1.2635
In the range of 1.3100 – 1.2635