By: Bastian Rubben
The US stock markets opened the trading week on the green territory, though Dow-Jones made first signs for a possible weakening. The financial sector caused the index to close almost at the opening level and there is a break-down pattern in the daily chart, on the support at 13,200. The other two main indices looks strong for now, but if the Dow breaks-down, it might pull them down as well. If this happens, I expect to see a strengthening of the USD against the major currencies.
The Canadian dollar has been strengthening against the USD for several months and after the USD failed in making a significant correction movement, the pair USD/CAD looks like it is ready for another bearish session. The pair broke the important support at 0.99 but failed in continuing the momentum after the break-down and the USD managed to rise above the support after each break-down. However, the pair made a break-down pattern in the daily chart, around last week's low at 0.987, and a successful break-down this time might take the pair down to 0.975.
The Euro, which is also strengthening against the USD these days after several weeks that the USD had the upper hand, is gaining points against the CAD. There is a double-bottom pattern in the daily chart of the pair EUR/CAD and stochastic low levels indicate for oversold situation, which means that we could expect a correction now that might hit 1.325-1.33. However, the general trend of this pair is unquestionably bearish and therefore the CAD might turn over any day.
