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USD/CAD could push lower in the next couple of weeks - TD Securities

FXStreet (Łódź) - TD Securities team of analysts look at the recent USD/CAD moves and predict that the pair could fall in the nearest future.

Key quotes

"USD/CAD is showing very little sign of any directional intent onthe short-term chart; the USD has moved mostly sideways this week so far, consolidating Monday’s sharp drop."

"But the underlying message here remains that downside risks are building; the hourly picture, above, shows the USD/CAD consolidating in a bear wedge of flag formation, with renewed pressure on the downside likely to build below 1.1157 intraday."

"There is a strong band of resistance above the market between 1.1200/20 which should slow near-term USD gains. We think USD/CAD remains at risk of pushing lower in the next couple of weeks; loss of support in the mid/upper 1.11s should reinforce the prospect of a drop to 1.10."

"USD/CAD is struggling to recover from the sharp sell-off from the upper 1.12 area seen earlier this week."

"We noted the bearish daily pattern on the candle chart (bearish “engulfing” line) which formed Monday. This risks being “complemented” by a bearish reversal signal on the weekly chart this week (contingent on a weekly close below 1.1200)."

"Combined, the daily and weekly signals would suggest a strong rejection of the upper 1.12 area again and reinforce prospects for some near-term corrective pressure on funds after the rally form the 1.08 area."

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