Thursday, January 20, 2011

USD/CAD Technical Analysis | 20 January 2011

USD/CAD Technical Analysis | 20 January 2011

Support levels: 0.9820, 0.9711, 0.9650
Resistance levels: 0.9980, 1.0212, 1.0290

On a 4-hour graph the USD/CAD is testing the resistance level at 0.9980. Earlier the USD/CAD has bounced off after refreshing a multi-month low. The viewpoint to the pair is still bearish as the downtrend remains. As mentioned before, the breakout of the 0.9890 support level allowed this pair to reach 0.9820 with 0.9711 as the next target.

Moreover, this breakout has provided certain interest to selling and quite significant interest to purchase from corporate market participants.

In the midterm the breakout of the support level at 0.9930 indicated continuing midterm downtrend from 1.3063 (2009 high) with 0.9700 as a target. However, this downside movement is probably a correction, and strong support level is located near 0.9056-0.9700.

Thus, if a reversal takes place, the breakout of 1.0851 will prove the downtrend broken through from 1.3063. In this case the USD/CAD is expected to go up to the resistance level 1.1126 with 1.1866 as the next target.

by Vladimir Donin, Analytical expert , InstaForex © 2007-2011