EURCAD and CADJPY, Daily
On Friday I wrote a report on EURCAD: “The 1.5050 support is a key short term level to watch as this also marks a confluence of technical support with the 50% Fibonacci retracement of the 1.4730/15370 in November . A breakout would open 1.4970 which is the confluence 61.8% Fib. level and the 200-period MA . The consolidation range breakout would imply upside momentum up to 1.5230 resistance level. ” –Today , the pair retraced by 50% of the gains seen on November, while it is currently moving at 1.5018, which is the 20-Day MA level. The pair is likely to retest today the 61.8 Fib. level at 1.4970, with the intra-day Bollinger Bands extending its low pattern and RSI crossing below theoversold terittory, with more space on the downwards. A strong break below that, then the next support to be retest is the 50-Day Ma at 1.4884.
This week, plenty of Canadian Dollar crosses seems to gain my interest, after Friday’s as-expected Q3 GDP, strong September GDP and the much larger than expected gain in November employment. The one who triggered most of my attention and encourage me to take a long Daily position at 88.93, was CADJPY, due to the hold today above the 20-Day MA but also after the break of the 20-WEEK Moving average, at 88.82. The pair forms a rising wedge in a Weekly basis since last November, which seems to provide a strong support for it. The price action seems to also find support at 50-weeks MA since May 2017.
In a Daily time-frame, is well supported by 200-Day MA since June 2017, since despite the fall seen the last 3 month, the pair manage to hold above 200-MA at 86.20, while it is retesting today the 50-Day MA. The Daily Momentum indicator, confirm that pair started gaining upwards momentum, with RSI breaking above the 50 level on Friday’s closing, after the neutral consolidation seen the last months.
Nevertheless, the decision on entering long was further confirmed by pair’s intra-day performance. The pair is moving northwards of 200-period MA in the 4-hour chart, with the upper Bollinger Bands extending its upper line. MACD line turned to positive on Friday as well.
Target were set at 89.50 and 89.95, with Support at 87.90-88.14 area.
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