The USD/CAD moved more than a cent and a half off the high monday (0.9720) to currently trading below 0.9550 on Tuesday.
So far today the pair has been supported above 0.9540. A break below opens the door to the intial target and recent low of 0.9525. Trader's will need their head on a swivel if we break below 0.9500 which is the next logical support point, even though technical support does not exist until much lower.
- USD/CAD Hourly - FreeStockCharts.com
The longer term daily trend remains down, while the hourly downtrend was broken last week. The snap back today has once again aligned the short-term with the longer-term trend.
On rallies, resistance (former hourly upward trendline support) is crossing at 0.9610. Beyond that 0.9670-0.9680 has posed problems for the rate other than the brief blip above it on Monday (which quickly corrected). MACD is still showing divergence on the long term daily chart, yet price action recently does indicate this rate is in any immediate danger of snapping higher. On a positive note (for USD bulls) is that speculative buying interest seems to be subsiding on the USD long side - too many players on one side of the market is a contrary indicator so less of them means a "blow off" to the downside (like we saw in 2007) is less likely.
Daily trend channel support comes in near 0.9450 and to be seen will require a break below the support levels mentioned above which should be watched closely.
With a relatively quiet news days, the rate is likely to have an upper cap of 0.9610. If the 0.9525 lows are broken, the daily range could widen (potentially considerably) with a daily low reaching down towards 0.9450-0.9400.
