As continued downside pressure saw USDCAD weakening below 1.0042 level (its last week support) in early morning trading today, further downside pressure is likely towards the 0.9922 level, its daily 200 ema.The pair has been under pressure since losing upside momentum at 1.0655 level in early Oct'2011. Though expected to find a breather and bounce higher on recovery at this level, a break below the 0.9922 level will bring further declines towards the 0.9765 level, its Aug 09'2011 low and then a distant support standing at the 0.9724 level. Its daily RSI is bearish and pointing lower supporting this view. The alternative scenario will be a reversal of its present weakness and the resumption of short term uptrend though a tough call at its present price levels. For this occur, the pair will have to take out the 1.0233/1.0655 levels, its Oct 07'2011 low/Oct 04'2011 high. This will open up further upside risk towards the 1.0852 level, its May'2011 high. All in all, having continued to weaken, the pair remains vulnerable.
Join the Discussion