USD/CAD Daily Forecast 18.01

USDCAD

Price: 1.0287

Resistance: 1.0319 ... 1.0350 ... 1.0400 ... 1.0435

Support: 1.0280 ... 1.0259 ... 1.0235 ... 1.0205

Bias: Mixed – waiting for breaks though still favor one more high to around 1.0319 or 1.0363

Daily Bullish: The 1.0170-05 area held the pullback lower yesterday and allowed the upside to resume to reach 1.0307. I feel we are now close to a peak and larger reversal. While 1.0280 supports the risk still remains higher to 1.0319 minimum. Take care there as this could force a reversal. However, there is still a higher potential target at 1.0350-63 which I suspect is the highest we should see.

MT Bullish: The breach of 1.0247 should extend the upside to 1.0319 minimum and probably 1.0363 but from here we must be aware of the risk of reversal lower. Further resistance is at 1.0435. (18th January)

Daily Bearish: The 4-hour chart continues to show a bearish divergence while the hourly does seem at risk of developing. There is resistance at 1.0319 and if this holds and is followed by a break back below 1.0280 and 1.0258 it should cause losses down to the 1.0205-10 area which should hold on first test. This is where a channel support line rests. Thus below 1.0200 is more bearish for 1.0124 initially.

MT Bearish: The 1.0319 and 1.0363 levels hold the greatest risk of forcing a correction lower. Below the 1.0205-10 channel support should see losses to the start at 0.9960 and later to the 0.9755 low again. (18th January)

This is looking more and more like a Triple-Three correction higher and with the break of 1.0247 we appear to be seeing an expanded flat with a 14.6% expansion at 1.0319 and a 23.6% at 1.0363. Expect reversal from one of these areas.

Ian Copsey

FX-Strategy