On Thursday, the US Dollar was falling, and the USD/CAD pair reached its new local lows.
Demand for the American currency declined as the results of the Fed monetary policy meeting lowered chances that the Regulator will increase interest rates in March. Moreover, the US Dollar has been under pressure from recent macroeconomic statistics.
Thus, data on Durable Goods Orders for December was released in the US on Thursday. The cost of orders fell by 5.1% while only a 0.6% decline was expected. In November, the indicator came in at -0.5%.
Support and resistance
Bollinger Bands indicator on the daily chart is turning gradually down while the price range is widening actively. MACD is falling and keeping a strong sell signal. Stochastic is in the oversold zone and trying to turn up, so there is a possibility of an upward correction in the short run.
According to the indicators, short positions are preferable.
Support levels: 1.4000 (important psychological level), 1.3947 (28 January low), 1.3850, 1.3780, 1.3700.
Resistance levels: 1.4050, 1.4100, 1.4169, 1.4200, 1.4245, 1.4325 (26 January high), 1.4400, 1.4450, 1.4500, 1.4609, 1.4700.
Short positions can be opened after the breakdown of the level of 1.3970 with targets at 1.3900, 1.3820 and stop-loss at 1.4000. Validity – 1-3 days.
Long positions can be opened after the price turns up at the level of 1.4000 and overcomes 1.4030 with targets at 1.4100, 1.4140 and stop-loss at 1.3990. Validity – 1-3 days.