Forex Technical Update
USD/CAD Daily Chart 9/11/2012 7:55AM EDT
Commodity currencies are firming during the 9/11 trading session. The USD/CAD has been in a bearish mode since finding a high of 1.0444 to start June. As summer is wrapping up, the pair has dug up new 2012 lows, and is testing the 0.9725 support pivot from 2011.
When taking a look at the weekly chart, we see that the bear run has a downside risk toward the 2011 lows just above 0.94. The RSI has broken below 40, signaling a loss of the bullish momentum seen last year in July through September and early October.
If there is a strong pullback, failure to break previous support pivots (up to 0.9890) should confirm bearish stance. Meaning a break above 0.99 makes the bearish outlook unclear, and a break above parity should introduce a bullish reversal scenario.
In the meantime, the market's trend is gravitating USD/CAD toward the 0.94-0.9450 area. This bearish outlook has an even higher chance if oil rallies, for example, if Brent Crude breaks it's recent range to the upside.
USD/CAD Weekly Chart 9/11/2012 8:00AM EDT
Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
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