Yesterday the pair strengthened again.
The Canadian Dollar is under strong pressure from falling oil prices. In addition, the currency was pressured by data that came out on Monday in Canada and was significantly worse than forecasts, as well as the Bank of Canada Business Outlook Survey. Data on Housing Starts for December showed a decline from 212 to 173 thousands, while economists forecasted 200 thousands.
Support and resistance
Bollinger Bands on the daily chart is growing while the price range is widening. However, the price is still trading outside of the range. MACD is about to turn down but keeping a buy signal yet. Stochastic is in the overbought zone and turning down.
The indicators suggest a possibility of the downward correction.
Support levels: 1.4245 (local low), 1.4200, 1.4169, 1.4100, 1.4050 (7 January low), 1.4000 (psychologically important level), 1.3915, 1.3850, 1.3780.
Resistance levels: 1.4315 (local high), 1.4360, 1.4400, 1.4450.
Long positions can be opened after the breakout of the level of 1.4300 (with the appropriate indicators signals) with the target at 1.4400 and stop-loss at 1.4270. Validity – 2-3 days.
Short positions can be opened after the breakdown of the level of 1.4175 with targets at 1.4100, 1.4030 and stop-loss at 1.4200. Validity – 2-3 days.