CAD: Technical indicators favor additional USD gains - BBH

Sandeep Kanihama FXStreet Contributor

The US dollar carved out a nearly textbook perfect head and shoulders pattern against the Canadian dollar last month as it broke the neckline (~CAD1.28) in early April, explains the research team at BBH.

Key Quotes

“The measuring objective was CAD1.2475. The greenback's downside momentum began easing, though a marginal new low was set on April 17 (~CAD1.2530). A combination of the continued rise in US rates, a patient Bank of Canada, and soft Canadian CPI and retail sales saw the greenback jump to almost CAD1.2770.”

“The dollar finished above its 20-day moving average (~CAD1.2735) for the first time in a month. The pre-weekend rally also saw the dollar meet the 38.2% retracement objective (~CAD1.2755). The 50% retracement (~CAD1.2825) corresponds to some old congestion and provides a reasonable near-term objective. The technical indicators favor additional US dollar gains.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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