(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance lines in yellow; chart pattern in dotted yellow; Fibonacci retracements in grey; 50-period simple moving average in light blue.)
4/15/2008 USD/CAD The long-term USD/CAD WEEKLY chart, as displayed, shows price continuing to languish within a confined flag consolidation. Entrenched in a long-term parallel downtrend channel (represented by the parallel red lines) since at least early 2003, the pair overshot the bottom line of the channel a bit in November 2007, and then bounced right back up in a countertrend retracement targeting the top resistance line of the downtrend channel. The current flag formation (in dotted yellow) could be serving as a well-defined continuation pattern within this countertrend retracement, helping to push price up ultimately towards its intended target at the top of the channel. In the event of an expected breakout above this flag, major resistance imposed by the abovementioned top line of the channel currently coincides with a key 61.8% Fibonacci retracement level (the high-to-low retracement span being measured from the last major touch of the top channel line in February 2007 to the last swing low in November 2007).
Chief Technical Analyst
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