Start Trading Now Get Started
Table of Contents
Affiliate Disclosure
Affiliate Disclosure DailyForex.com adheres to strict guidelines to preserve editorial integrity to help you make decisions with confidence. Some of the reviews and content we feature on this site are supported by affiliate partnerships from which this website may receive money. This may impact how, where and which companies / services we review and write about. Our team of experts work to continually re-evaluate the reviews and information we provide on all the top Forex / CFD brokerages featured here. Our research focuses heavily on the broker’s custody of client deposits and the breadth of its client offering. Safety is evaluated by quality and length of the broker's track record, plus the scope of regulatory standing. Major factors in determining the quality of a broker’s offer include the cost of trading, the range of instruments available to trade, and general ease of use regarding execution and market information.

USD/CAD Daily Outlook - Oct. 10, 2012

By Christopher Lewis
Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.

The USD/CAD pair did very little during the Tuesday session, as the markets continue to digest all of the news surrounding the oil markets. Looking at the recent action in this pair, we have seen a break down below the 0.98 handle which was once supportive. In fact, this was the bottom of a massive consolidation area, and as such the breakdown early in September should have been very significant.

We saw the pair fall all the way down to the 0.9625 area, but only to bounce higher and back to the 0.9860 level. In a sense, we are trying to figure out whether or not this was a false breakout, or the beginning of acceleration to the downside. The action on Monday suggested that we try to get back above the 0.98 handle, but failed. However, on Tuesday we saw an outside candle that was positive. I still see quite a bit of resistance all the way to the 0.9950 level on this chart, and as such I am not willing to buy quite yet.

I still believe that this pair will have a much easier time falling than rising. However, with the sudden concerns of global growth it may be difficult for commodity currencies to continue to gain for the short term. Because of this, the Canadian dollar of course will be vulnerable to the safe haven trade as money will flow back into the US dollar.

Consolidation, then the move

This pair has a long history of grinding for significant amounts of time before moving in one direction or the other. The move is normally quite sharp and drastic, so it certainly catches a lot of people off guard. Because of this, it is absolutely vital to have set levels in this pair in order to make your trading decisions.

For me, the buying level is the 0.9950 level. If we can get above that on a daily close, I think that we will continue to bounce around in the former consolidation zone and aim for the 1.04 level. On the other side of that trade, I see the 0.97 handle as one that could get sellers involved if we break down below it. In the meantime, I feel this pair will do very little and probably be very choppy.

USDCAD Daily 101012

Christopher Lewis
Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.

Most Visited Forex Broker Reviews