Technical Analytics Report

USD/CAD: Fundamental Analysis Report 13 April 2021

USD/CAD: Fundamental Analysis Report 13 April 2021

 

Current trend: “bullish” trend development

 USD is showing moderate growth against CAD, developing a “bullish” signal, formed the day before, when the instrument retreated from its local lows.

 Moderate support for USD is provided by the continuing growth in the yield of US Treasury bonds, coupled with the general positive sentiment of investors regarding the prospects for the recovery of the American economy. Only statistics on inflation distorts the overall picture.

 In turn, CAD is still supported by a strong report on the Canadian labor market for March published last Friday and reflecting a sharp decline in the unemployment rate in the country from 8.2% to 7.5%, which turned out to be significantly better than market expectations of 8%. The employment change in Canada in March also rose sharply by 303.1K, outstripping the growth rate of the previous month at the level of 259.2K. Market forecasts assumed an increase of only 100K.

 Support and Resistance

 In the D1 chart, Bollinger Bands are reversing horizontally. The price range does not change, outlining the approximate boundaries of the short-term flat. MACD indicator is growing, maintaining a weak buy signal (the histogram is above the signal line). Stochastic, after a short decline at the end of last week, is trying to reverse upwards, reflecting the growing buying activity in the ultra- short term.

The development of uptrend is possible in the near future. 

·         Resistance levels: 1.2600, 1.2650, 1.2700.

·         Support levels: 1.2554, 1.2500, 1.2439, 1.2400. 

Trading Tips

 To open long positions, one can rely on the breakout of 1.2600. Take-profit – 1.2700. Stop-loss – 1.2554. Implementation time: 2-3 days.

 A rebound from 1.2600 as from resistance, followed by a breakdown of 1.2554 may become a signal for new sales with the target at 1.2500. Stop-loss – 1.2585.

 Scenario

 Timeframe: Intraday

Recommendation: Buy Stop

Entry Point: 1.2605

Take Profit: 1.2700 

Stop Loss: 1.2554 

Key Levels: 1.2400, 1.2439, 1.2500, 1.2554, 1.2600, 1.2650, 1.2700

 Alternative Scenario

 Timeframe: Intraday

Recommendation: Sell Stop 

Entry Point: 1.2550 

Take Profit: 1.2500 

Stop Loss: 1.2585 

Key Levels: 1.2400, 1.2439, 1.2500, 1.2554, 1.2600, 1.2650, 1.2700


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