Analys från DailyFX

USD/CAD Technical Analysis: CAD Remains Advantaged with USD on its Heels

Published

7 år ago

5 juni, 2017

DailyFX

Think CAD strength is making a comeback? See our forecast to find out what is driving market trends!

Talking Points:

USD/CAD technical strategy: holding a ‘sell’ bias below 1.3545 on closing basis
USD/CAD downside momentum currently stalled, watching break below 1.3390
CAD employment data + housing data later in the week likely CAD-drivers in week ahead

Despite post-OPEC Crude Oil weakness, the Canadian Dollar has managed to hold a below the mid-point of a rising channel that has taken USD/CAD from a low of 1.24 in May of 2016 to just shy of 1.38 in early May. Since the near-touch of 1.38, USD/CAD has fallen back to earth and may continue to do so when looking at what appears to be a momentum overshoot similar to what was seen in January 2016 before falling nearly 16% in fourth months.

The chart below shows how aggressively high RSI(5) on the daily chart was with the recent tag of the 100% Fibonacci expansion. Now, it’s helpful to look behind price to see the driving forces, but one could argue that given the relative weakness of the USD that the CAD is ripe to extend its gains to the bottom of the price channel at 1.3250 if the price can break below the late May low of 1.3390.

The question of what will eventually drive the USD, and thus USD/CAD higher remains unanswered. It is difficult to get confident of the long’s argument for USD/CAD. However, we remain trading in a choppy rising channel, which argues that it is difficult (or unwise) to hold un-managed short trades in this environment.

That being said, a look at shorter-term charts do show an impulsive five-wave move lower from the 1.3793 high in May. I favor a move lower, but what happens near 1.3250 is likely the real show for technical traders. The sentiment picture is showing that prices may continue to fall when taking a contrarian view, but again, we’ll have to revisit sentiment, the fundamental picture and price action if we get to the bottom of the channel to see where higher probability trade lies.

Join Tyler at his Daily Closing Bell webinars at 3 pm ET to discuss key market developments.

Chart Created by Tyler Yell, CMT

USD/CAD Insight from IG Client Positioning

The sentiment highlight section is designed to help you see how DailyFX utilizes the insights derived from IG Client Sentiment, and how client positioning can lead to trade ideas. If you have any questions on this indicator, you are welcome to reach out to the author of this article with questions at tyell@dailyfx.com.

USDCAD: Retail trader data shows 51.0% of traders are net-long with the ratio of traders long to short at 1.04 to 1. The number of traders net-long is 3.8% lower than yesterday and 5.8% higher from last week, while the number of traders net-short is 25.8% higher than yesterday and 8.0% higher from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests USDCAD prices may continue to fall. Yet traders are less net-long than yesterday and compared with last week. Recent changes in sentiment warn that the current USDCAD price trend may soon reverse higher despite the fact traders remain net-long. (Emphasis mine)

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Shorter-Term USD/CAD Technical Levels: Monday, June 5, 2017

For those interested in shorter-term levels of focus than the ones above, these levels signal important potential pivot levels over the next 48-hours.

Contact and discuss markets with Tyler on Twitter: @ForexYell

Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

Published

7 år ago

30 september, 2017

DailyFX

What’s inside:

EURUSD broke the ‘neckline’ of a bearish ‘head-and-shoulders’ pattern, April trend-line
Resistance in vicinity of 11825/80 likely to keep a lid on further strength
Targeting the low to mid-11600s with more selling

Confidence is essential to successful trading, see this new guide – ’Building Confidence in Trading’.

Coming into last week we pointed out the likelihood of finally seeing a resolution of the range EURUSD had been stuck in for the past few weeks, and one of the outcomes we made note of as a possibility was for the triggering of a ’head-and-shoulders’ pattern. Indeed, we saw a break of the ’neckline’ along with a drop below the April trend-line. This led to decent selling before a minor bounce took shape during the latter part of last week.

Looking ahead to next week the euro is set up for further losses as the path of least resistance has turned lower. Looking to a capper on any further strength there is resistance in the 11825-11880 area (old support becomes new resistance). As long as the euro stays below this area a downward bias will remain firmly intact.

Looking lower towards support eyes will be on the August low at 11662 and the 2016 high of 11616, of which the latter just happens to align almost precisely with the measured move target of the ‘head-and-shoulders’ pattern (determined by subtracting the height of the pattern from the neckline).

Bottom line: Shorts look set to have the upperhand as a fresh month gets underway as long as the euro remains capped by resistance. On weakness, we’ll be watching how the euro responds to a drop into support levels.

For a longer-term outlook on EURUSD, check out the just released Q4 Forecast.

EURUSD: Daily

—Written by Paul Robinson, Market Analyst

You can receive Paul’s analysis directly via email bysigning up here.

You can follow Paul on Twitter at@PaulRobinonFX.

Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

Published

7 år ago

29 september, 2017

DailyFX

Euro Bias Mixed Heading into October, Q4'17

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

EURUSD: Retail trader data shows 37.3% of traders are net-long with the ratio of traders short to long at 1.68 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07831; price has moved 9.6% higher since then. The number of traders net-long is 15.4% lower than yesterday and 16.4% higher from last week, while the number of traders net-short is 0.4% higher than yesterday and 10.5% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Positioning is more net-short than yesterday but less net-short from last week. The combination of current sentiment and recent changes gives us a further mixed EURUSD trading bias.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

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Analys från DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Published

7 år ago

29 september, 2017

DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

GBPUSD: Retail trader data shows 38.2% of traders are net-long with the ratio of traders short to long at 1.62 to 1. In fact, traders have remained net-short since Sep 05 when GBPUSD traded near 1.29615; price has moved 3.4% higher since then. The number of traders net-long is 0.1% higher than yesterday and 13.4% higher from last week, while the number of traders net-short is 10.6% lower than yesterday and 18.3% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse lower despite the fact traders remain net-short.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form