The Bank of Canada kept the interest rate as it was, which was expected, and that decision caused a big 140 pips drop on the USD/CAD charts. The pair even managed to fall below the strong support of the diagonal trendline that connects the last four lows since 23rd June. Eventually it reached 1.2935, but quickly retraced above the trendline again.
The drop, however, ended at the strong support at 1.2960 that can be seen on the daily, weekly and monthly time-frames, as well as at the diagonal trendline. In other words, we really need to keep this level in mind. If the pair succeeds in breaking below it and remains below 1.2950 we could expect it to continue falling towards 1.2850 -1.2800. For now it is unclear whether that will happen.
I, personally, would wait for a breakout below the diagonal trendline and a retracement back to the breakout before I open new short positions, but that is unlikely to happen today.
Good post!
ReplyDeleteHelpful post!
ReplyDeleteVery helpful article.
ReplyDeleteVery helpful analysis, thank you.
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ReplyDeleteIt looks like a symmetrical triangle is gaining form.
Good posts, very helpful for all traders.
ReplyDeleteGood insight.
ReplyDeleteThanks for the analysis.
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