USDCAD runs into sellers around 1.3201 for the forth day in a row
US Dollar/Canadian Dollar (USDCAD) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
USDCAD ended Wednesday at 1.3179 losing 7 pips (-0.05%). Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (USDCAD as at Sep 16, 2020):
Wednesday's trading range has been 73 pips (0.55%), that's slightly below the last trading month's daily average range of 83 pips. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for USDCAD. Prices continued to consolidate within a tight trading range between 1.3119 and 1.3208 where it has been caught now for the whole last trading week.
Two candlestick patterns are matching today's price action, the Bearish Spinning Top and the Hanging Man which are both known as bearish patterns.
After trading down to 1.3128 earlier during the day, the forex pair bounced off the key technical support level at 1.3133 (S1). The failure to close below the support might increase that levels significance as support going forward. When prices bounced off a significant support level the last time on August 12th, USDCAD actually lost -0.17% on the following trading day. The market was sold again around 1.3201 after having seen highs at 1.3202, 1.3197 and 1.3208 in the last three trading sessions. Obviously there is something going on at that level.
Although the currency is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Buying might speed up should prices move above the nearby swing high at 1.3202 where further buy stops could get triggered. Selling might accelerate should prices move below the close-by swing low at 1.3119 where further sell stops could get activated.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous two Highs" stand out. Its common bearish interpretation has been confirmed for USD/CAD. Out of 156 times, USDCAD closed lower 56.41% of the time on the next trading day after the market condition occurred.
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 0.61% and NZDUSD closing 0.27% higher. On the flipside the worst performers have been USDJPY closing -0.47% lower and EURUSD losing -0.25%. Looking at the Minor FX Pairs and Crosses, the winners of the day have been GBPPLN surging 0.81% and ZARJPY closing 0.78% higher. The worst performers of the day have been EURZAR tanking -1.42% and CHFZAR closing -1.28% lower. Read more