Bearish momentum in the USD/CAD continued once again yesterday, building on Monday’s negative start to the week for the pair, moving lower once again today, and now preparing to test parity in the short term. The key support level for the pair was breached last week, and then tested on Monday in the 1.0100 price region, and with this level now broken, is now adding further downwards pressure.
Moving to the volume indicators, yesterday’s trading volume was higher than that of Monday, and rising in line with the wider spread candles, and with no evidence of any buying at this level, negative sentiment continues to weigh on the pair. The Canadian dollar is also receiving a boost from the recent bullish momentum in oil, which is now testing the $96 per barrel level on the WTI futures contract.
On the left of the screen, the volume at price indicator clearly defines the support and resistance levels, and immediately below the current price action, potential support is thin, and the next real level is the 0.9950 area and below. If this is breached then expect to see a deeper move develop in the medium term with a retest of the 0.9820 area of late last year now a possibility.
By Anna Coulling