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USD/CAD to remain in ascending channel for now

al_dcdemo Posted 22 June as Analysis on USD/CAD, Target: 1.3275, Date: 1st of August, 12:00 GMT  in #Technical analysis #USD/CAD #Daily Chart #Ascending Channel #Weekly Chart #Technical Tools #Net Short Positioning #Strong Supply #Optimistic Boc
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
A sharp rally at the start of 2016 and an even more impressive reversal has been followed by an upward sloping channel. 1.28 - 1.30 area is central …
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al_dcdemo 15 July

UPDATE 6: It was a worst week for the U.S. dollar in a while. It started with the BOC decision on Wednesday after which Canadian dollar surged about 200 pips. The next day, Aussie and Kiwi played catch-up and rose about 100 pips respectively. Eagerly anticipated U.S. inflation and retail sales reports came in weaker than expected yesterday and exacerbated dollar losses across the board. Cable sliced through 1.30 to 1.3115, the highest in ten months. Euro had tough time holding above 1.14 but ended the week near the high, poised for a break higher. Interesting week ahead.

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al_dcdemo 23 July

UPDATE 7: The U.S. dollar ended another week of underperformance, falling against all major currencies bar the British pound. Euro confirmed break above 1.145 to trade to the highest since mid 2015. Mirroring its cousin, Swiss franc closed the week below 0.95. Yen was bought down to 111. Canadian dollar extended its rally to approach 1.25. Australian dollar broke above 38.2% retracement of the 2014 - 2016 downswing. New Zealand dollar closed the week near 0.745, just below the 50.0% retracement of the 2014 - 2015 decline. Momentum suggests further losses for the dollar in the week ahead.

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al_dcdemo 24 July

UPDATE 8: A mixed start of the week saw yen, pound, Canadian dollar and Australian dollar extend gains while euro, franc and New Zealand dollar are lagging. Data-wise, it's a quiet one until Wednesday when Australia publishes inflation data, U.K. releases preliminary GDP and FOMC concludes its meeting. U.S. reports durable goods orders on Thursday and GDP on Friday. Unless FOMC pulls a surprise, neither of these events has the potential change the current macroeconomic landscape. U.S. politics seems a more likely source from where some kind of a twist could come.

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al_dcdemo 27 July

UPDATE 9: Reaction to the latest FOMC statement was quite strong for a meeting without press conference. The statement didn't reveal anything new but clearly the market was expecting something more hawkish. The committee indicated that it will begin with balance sheet adjustment "relatively soon". The language on inflation, however, has deteriorated a bit and that was probably the main reason the market sold the dollar. While balance sheet adjustment is now virtually a done deal, we may see further hikes in federal funds rate only if inflation picks up.

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al_dcdemo 31 July

UPDATE 10: Last week was an interesting one. Major currencies traded to fresh highs against the U.S. dollar. The exception was Swiss franc which sold off strongly against all those currencies, including the dollar. Two cent and a half surge from sub 0.95 to above 0.97 might well have had SNB backing. There's nothing on the calendar for the week ahead that has the potential to reverse the current U.S. dollar weakness. Perhaps a concerted dovish effort from RBA and BOE could put a dent into this trend but probably not for too long.

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USD/CAD headed to the channel trendline

al_dcdemo Posted 26 May as Analysis on USD/CAD, Target: 1.3275, Date: 3rd of July, 12:00 GMT  in #Technical analysis #USD/CAD #Daily Chart #Channel #Weekly Chart #Technical Tools #Net Short Positioning #Strong Supply #Optimistic Boc
Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
A sharp rally at the start of 2016 and an even more impressive reversal has been followed by an upward sloping channel. 1.28 - 1.30 area is central …
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al_dcdemo 10 June

UPDATE 6: It was a mixed week for the U.S. dollar. The world's reserve currency finally got some traction against European currencies. Dovish ECB and U.K. voters, going against PM May's and indeed market expectations, contributed fundamental background for the technical weakness to play out. The dollar was flat against the yen and the Canadian dollar but it fell short compared to the Antipodean currencies. Next week brings four major central bank meetings, namely Fed, SNB, BOE and BOJ. The Fed is widely expected to hike interest rate corridor by further 25 basis points.

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al_dcdemo 13 June

UPDATE 7: Canadian dollar staged a sharp rally yesterday after BOC deputy governor Carolyn Wilkins said that the bank will assess whether all the stimulus that they have in place is still needed. She was upbeat on economy while brushing aside housing worries. USD/CAD traded down to 1.3325 by the end of the day and is following thorough today. April low (1.3225) is the initial support before stronger one at 2016 - 2017 channel bottom (1.3150 - 1.32). Broken 200 and 100 DMA should as resistance levels in case of a retracement.

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al_dcdemo 15 June

UPDATE 8: Fed's FOMC was surprisingly hawkish yesterday. They hiked federal funds rate by 25 basis points, as expected, and outlined strategy for reducing their balance sheet. FOMC chair Yellen told reporters that the balance sheet adjustment could begin "relatively soon". Just a couple of hours before the FOMC decision, both inflation and retail sales reports came in weak and markets sold U.S. dollar on speculation that the FOMC will postpone hiking until data improves. The dollar recovered and followed through today.

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al_dcdemo 24 June

UPDATE 9: The currency markets were relatively sedate this week. Major pairs traded in 100-pip ranges with exception of Cable whose range exceeded 200 pips. With no big events on the agenda until September, it's possible that we'll be seeing somewhat slower activity throughout the summer. That said, there's always opportunity in at least some pairs and timeframes, and we must always expect the unexpected. Central bank speakers will continue to dominate in the week ahead and markets will be positioning for their next moves in the coming weeks.

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al_dcdemo 30 June

UPDATE 10: Canadian dollar has been among the most wanted major currencies in recent days. Hawkish talk by the BOC was taken seriously with markets now pricing a July 12th hike with 70% probability, up from 35% at the start of the week. USD/CAD fell 160 pips on Wednesday alone and 360 pips since the middle of last week. It broke below 2016 - 2017 channel and strong support area between 1.30 and 1.3065 in the process. 1.2825 is the next target. A deeper pullback could extend to 1.31 - 1.3150.

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