(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; uptrend lines in green; downtrend lines in red; horizontal support/resistance lines in yellow; 50-period simple moving average in light blue.)

1/15/2009 – USD/CAD – After having triple-tested the key 1.3000 resistance level over the last several months, price action on the USD/CAD (a daily chart of which is shown) has once again risen to target that 4-year high for a potential fourth test. The tremendous bullishness in the pair this week has broken cleanly above a short parallel downtrend channel, and this bullishness does not appear to be over yet. With exceptionally strong resistance in the noted 1.3000 level, and near-term support around 1.2450, price should shortly go into consolidative or corrective mode before potentially making its push back up towards the pair’s 4-year highs.

James Chen
Chief Technical Strategist
FX Solutions

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