After retesting the H4 mid-level number at 1.2450 on Wednesday, the USD/CAD drove aggressively skywards. The Canadian dollar took a hit following a report (Reuters) that Canadian government officials say there’s an increasing likelihood US President Donald Trump will give six-month’s notice to withdraw from Nafta.
This lifted the H4 candles beyond the 1.25 handle up to a H4 resistance plotted a few pips ahead of 1.26 at 1.2580, before mildly paring gains into the closing bell. Bolstering the current H4 resistance is the 2018 yearly opening level seen on the weekly timeframe at 1.2579. Also possibly offering a helping hand is the daily supply zone coming in at 1.2554-1.2510. Despite having the top edge taken out, the area remains in play.
Market direction:
The 1.26 line/H4 resistance at 1.2580 (green zone) is an area worthy of consideration. Not only because of it holding back the buyers yesterday, but also due to its position on the bigger picture (see above). Therefore, should H4 price retest this H4 zone today and chalk up a full or near-full-bodied H4 bearish candle, a short with an initial target objective set at 1.25 could be a possibility. The reason for the additional candle confirmation is simply to try and avoid any fakeout that may take place around 1.26.
Data points to consider: US inflation figures m/m and US unemployment claims at 1.30pm; FOMC member Dudley speaks at 8.30pm; CAD NHPI m/m at 1.30pm GMT.
Areas worthy of attention:
Supports: 1.25 handle.
Resistances: 1.26 handle; 1.2580; 1.2579; 1.2554-1.2510.
This lifted the H4 candles beyond the 1.25 handle up to a H4 resistance plotted a few pips ahead of 1.26 at 1.2580, before mildly paring gains into the closing bell. Bolstering the current H4 resistance is the 2018 yearly opening level seen on the weekly timeframe at 1.2579. Also possibly offering a helping hand is the daily supply zone coming in at 1.2554-1.2510. Despite having the top edge taken out, the area remains in play.
Market direction:
The 1.26 line/H4 resistance at 1.2580 (green zone) is an area worthy of consideration. Not only because of it holding back the buyers yesterday, but also due to its position on the bigger picture (see above). Therefore, should H4 price retest this H4 zone today and chalk up a full or near-full-bodied H4 bearish candle, a short with an initial target objective set at 1.25 could be a possibility. The reason for the additional candle confirmation is simply to try and avoid any fakeout that may take place around 1.26.
Data points to consider: US inflation figures m/m and US unemployment claims at 1.30pm; FOMC member Dudley speaks at 8.30pm; CAD NHPI m/m at 1.30pm GMT.
Areas worthy of attention:
Supports: 1.25 handle.
Resistances: 1.26 handle; 1.2580; 1.2579; 1.2554-1.2510.
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