Analys från DailyFX
USD/CAD Technical Analysis: Jobs Week Meets Bullish Chart
Talking Points:
- USD/CAD Technical Strategy: trading sideways, looking for 100-DMA (1.3298) support
- US Canadian employment look for wage growth in the US and positive trend in Canada
- If you’re looking for Q2 Financial Market Forecasts, you can get them here
USD/CAD has drifted higher over 2017 as oil has global investors worried about where crude might go. However, crude has seen a decelerating selling trend per CFTC positioning data as OPEC is gaining the market’s hope that they will extend production cuts past the original June deadline. The positive correlation of oil to the Canadian Dollar has many traders consistently looking to Oil to see where the Loonie may trade next.
This week, traders may take their eyes off crude in favor of Friday’s jobs report that display recent hiring trends in both economies. Next week, the BoC is meeting, and a positive jobs report could earn their respect causing hawkish tones to find its way through Poloz’s message despite him providing no new guidance last week. Recently, we have seen Canadian data, specifically jobs, gaining at a stable pace since August and further gains could encourage CAD buyers in the hope that BoC will commend such improvement as a possible reason to normalize policy.
US Jobs data has also been strong, but given the question about reflation that has recently crept into view, many traders are likely to focus on wages. Any disappointing wage data for the US could further exasperate the recent worry and allow the Canadian Dollar to gain despite Oil’s next move.
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The chart below of USD/CAD shows that we’re trading in the middle of a rising channel. Traders should focus on the support development as the spot price of 1.34 sits above multiple forms of support. Just below the spot price is the trifecta of long-term moving averages, the 50-DMA (1.3239), the 100-DMA (1.3292), and the 200-DMA (1.3200), which all are near the Daily Ichimoku Cloud active as support. The recent drift higher causes a Bullish technical bias to remain absent any of those levels failing to hold.
The resistance that we are watching in this choppy uptrend focuses at first on the March 28 high (1.3114) followed by the March high of (1.35349). A reversal below the multiple levels of proven support near 1.32 would need to break to turn the technical view from bullish to neutral.
What Did The Analysts Learn After Trading Of All 2016? Click Here To Find Out
D1 USD/CAD Chart: Pullback In Rising Price Channel Likely Seen As Opportunity
Chart Created by Tyler Yell, CMT
IG Retail trader data shows 40.3% of traders are net-long with the ratio of traders short to long at 1.48 to 1. The number of traders net-long is 4.3% lower than yesterday and 9.5% higher from last week, while the number of traders net-short is 16.5% higher than yesterday and 6.5% higher from last week.
We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests USDCAD 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 USDCAD trading bias. (Emphasis Mine)
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Shorter-Term USD/CAD Technical Levels for Monday, April 3, 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 of trading.
T.Y.
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
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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.
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
To be added to Christopher’s e-mail distribution list, please fill out this form
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
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