The US dollar has broken down a bit during the trading session on Wednesday against the Canadian dollar, slicing through the 1.29 level. We could go as low as the 1.2825 level, an area that has been important in the past, and I think that it’s only a matter of time before the buyers get involved, either at that level, or near present trading. The 1.29 level of course is important, and I think that if we get a bounce from there, it’s likely that we go back to the 1.30 level.
I think that it’s only a matter of time before the buyers get involved though, so if we do short this market, we will have to do it very cautiously, and perhaps in small bits and pieces. I believe that the markets will continue to be very noisy, and difficult to say the least. I believe that it’s only a matter time before we break to the upside, but the 1.30 level above is very difficult to overcome, and I think will take several attempts to finally break above. Pay attention oil, if it starts to rebound that will of course send this market lower. If we were to break down below the 1.28 handle, that could send the market down to the 1.2750 level next.
Volatility is probably the one thing that you can count on in this market, especially as we have talks of tariffs between the United States and Canada. Ultimately, NAFTA will come into play as well, but I still think that it’s only a matter time before we rally.
USD/CAD Video 07.06.18
This article was originally posted on FX Empire
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