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Daily Shooting Star in USDCAD

Market Analysis
Chart_16-07-07_10-19-34

USDCAD, 240 min

USDCAD created a daily shooting in yesterday’s trading and is now trading at support at 1.2943. The pair is trading between 4h moving averages (30 and 50 SMA). The 15 min chart shows a series of lower high values in the high values over the last two hours. Only one of the recent candles at the time of writing has tried to challenge this pattern. This suggests that market is not trying turn higher from this support. Nearest resistance is at 1.2940 (next at 1.2930) while the nearest support is at 1.2940 (next at 1.2930).

The 4h Stochastics are oversold indicating that the market could rally before breaking lower. However, this would need to be confirmed by the price action. With the daily shooting star candle created in yesterday’s trading I’m preparing for this market to break lower rather than rallying higher first. If price breaks below 1.2940, I looking for sell signals after rallies with targets as follows: 1.2905 (T1) and 1.2860 (T2). Should the market however rally higher first I would be looking for sell signals at 1.3017 – 1.3030 sell area. If this was the case my targets are higher as follows: 1.2975 (T1) and 1.2340 (T2).

 

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Janne Muta

Chief Market Analyst

HotForex

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