Forex Technical Update
- After breaking below an ABC pattern, the USD/CAD cracked the 0.9740 support, but rallied sharply, now falling into a congestion triangle sine 8/31.
- The market rested inside the triangle with a test to the upside just ahead of the NFP.
- After the NFP showed a goose egg, the market was initially USD positive because of risk aversion, but then USD-weakness became universal in the reaction after that.
- The CAD however also suffers from this poor report, and we can see the USD/CAD breaking above the triangle, but still respecting resistance at 0.9820 at the moment.
- Support right now is near 0.9785, resistance at 0.9820. A break below 0.9785 invalidates the breakout. A break above 0.9820 confirms it.
- Upside risk in this and the next couple of sessions above 0.9820 is 0.9950-1.0(parity).
Fan Yang CMT
Chief Technical Strategist