The USD/CAD pair is another pair that is trading within a channel, and the pair has reacted to the top of that channel by printing a bearish engulfing candle off of Resistance at 1.0225. Since May 18 the pair has reversed or at least paused at this same level 5 times and now it coincides with the top of a descending channel, confirmed now by a third touch and reversal. There is now a high probability that we will see price trade lower to retest the bottom of this channel, probably meeting with resistance somewhere around parity. There is resistance on the way down however, at levels such as 1.0125 we have the Weekly Pivot and Weekly S1 @ 1.008. The monthly S1 is sitting at 1.00675, which also happens to be near the bottom of the channel and where price reversed from a bearish tone to a bullish one last. We might see price pause or reverse at that level and form a double bottom, but price action will tell us when the time comes. The Bulls have their work cut out for them as well with Resistance at 1.0187, the Weekly R1...and WR2 @ 1.0233. The Monthly Pivot is also above current price at 1.0256. While there is no relevant news scheduled from the land of the Maple Leaf, its southern cousin the USA will be releasing its Core Durable Goods & Unemployment numbers as well as Pending Home Sales later today. With little change expected, the CAD will probably continue to gain on the Greenback and trade lower in the channel as expected.
Happy Trading!