USD/CAD 4H Chart 9:45AM EDT 11/23/2012
Consolidation: USD/CAD was held above 0.9950 after falling below parity to start the week. It then spent the rest of the week consolidating above the “central pivot” area of a larger consolidation zone (between 0.9872 and the broken 1.0020-1.0032 resistance area. The smaller consolidation zone is between 0.9950 and 0.9990. Given some elbow room, I believe a break above parity, or a break below 0.9945 will be significant enough to clue in on the next directional swing.
Breakouts: The break above parity would extend a slight bullish bias in the 4H chart. Ultimately, the bullish scenario has the 1.0443 2012 high in sight. But we do have 61.8% retracement at 1.0133 as the short-term target above parity and the current high at about 1.0055. A break below 0.9945 opens up the 0.9872-0.9887 support area. Only a break below 0.9870 should open up further bearish outlook.
Fan Yang CMT is the Chief Technical Strategist, trader, educator and a of the main contributors to FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.