Flash: Longer-term price signals and momentum remain bullish for USD/CAD - TD Securities

FXstreet.com (Barcelona) - “Short-tem price trends have turned a little heavy for USD/CAD, with the market slipping back to the low 1.03 area,” noted Sean Osborne, Head of FX Strategy at TDS

Osborne went on to comment, “the short-term chart shows a possible H&S top still forming, with the neckline trigger residing just below 1.03 on the intraday chart (1.0298, red support line on the 6-hour candle, above). But the short-term oscillator signals are not suggesting an overbought market while trend momentum has flattened a fair bit. Combining those signals suggests to us that a sideways range trade, rather than a short-term trend reversal is likely, though the risk of the latter is non-negligible.”

To conclude Osborne noted, “short-term support at 1.0298 is reinforced by the long-term breakout resistance (now support) at 1.0295 on the daily/weekly chart. We can allow for a little slippage below this point over a short period of time but a sustained slide below 1.0295 (and a weekly close below) would put a lot of pressure on the longer-term bull outlook (1.06) we have outlined recently. Daily and weekly trend momentum remains positive and longer-term price signals are bullish. We look for limited downside from here.“