USDCAD closes higher for the 2nd day in a row
US Dollar/Canadian Dollar (USDCAD) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, USDCAD ended the week -0.81% lower at 1.3265 after gaining 30 pips (0.23%) today on low volume. Trading up to 50 pips lower after the open, the Loonie managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on December 24, 2018, USDCAD actually lost -0.20% on the following trading day. Closing above Thursday's high at 1.3260, the market confirmed its breakout through the previous session high after trading up to 19 pips above it intraday.
Daily Candlestick Chart (USDCAD as at Jan 11, 2019):
Friday's trading range has been 96 pips (0.73%), that's slightly above the last trading month's daily average range of 85 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for USDCAD. Prices continued to consolidate within a tight trading range between 1.3179 and 1.3280 where it has been caught now for the last three trading days.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bullish Outside Bar.
Though the FX pair is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Selling might speed up should prices move below the nearby swing low at 1.3179 where further sell stops could get triggered. Further selling might move prices lower should the market test December's close-by low at 1.3160.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Up Close near high of period" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for USD/CAD. Out of 545 times, USDCAD closed lower 55.23% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after nine trading days, showing a win rate of 53.21% with an average market move of -0.13%.
With four out of the other six Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 0.71% and NZDUSD closing 0.69% higher. On the flipside the worst performers have been EURUSD closing -0.27% lower and USDCHF losing -0.09%. Looking at the Minor FX Pairs and Crosses, the winners of the day have been NZDCAD surging 0.98% and GBPCAD closing 0.97% higher. The worst performers of the day have been EURNZD tanking -1.04% and EURGBP closing -0.99% lower. Read more