Canadian Dollar, USD/CAD Price Analysis
- As the US Dollar[1] has continued to fall, USD/CAD[2] has continued with strength.
- This highlights how the Canadian Dollar[3] has recently been even weaker than the US Dollar.
- Can USD[4]/CAD break out to fresh highs?
USD/CAD Rallies into Resistance
It’s been a continuation of fear so far through this week, with a possible turning point in a number of risk markets starting to show. The US Dollar, in particular, has been in focus[5] as last week’s breakout and Thursday’s push to fresh three-year-highs has quickly unwound. But, over the past half-of-a-day, support has held: Buyers appear to be getting just a little bit more aggressive, and this highlights the potential for a return of USD-strength. That support build comes in around the 38.2% retracement of the February rally in the currency; and this highlights a very interesting strategy component in the USD/CAD pair[6].
US Dollar Four-Hour Price Chart
USD/CAD for USD-Strength Strategies
As looked at a couple of different times over the past week, USD/CAD could remain an interesting candidate for strategies of USD-strength; largely on the basis of Canadian Dollar weakness, which has recently outdone that of the US Dollar.
I had looked into a setup last week that could work towards bullish continuation strategies[8]: Following a robust trend through January and the first week of February, price action finally found some element of resistance around the 1.3306 marker, which is the 50% level of the 2019 major move in the pair. Buyers pushed slightly beyond that price, albeit temporarily, only for follow-through resistance at the November highs to come into play; helping to thwart
