In our original posting we proposed the idea of entering a short-hedge at 1.0790 (61.8% Fib resistance) for those who are seeking to enter long at a more favorable price or for those already holding a long position. USDCAD triggered our entry order as it hit the identified resistance levels and is now on its way down towards the target of 1.0454 (50.0% Fib support).
The fall may not be as smooth as we’d like it to be as Friday will see the release of the University of Michigan Consumer Confidence Index. A third straight increase in the metric is highly plausible as decreasing fuel prices have given American consumers a more optimistic outlook. Despite this fundamental roadblock, our stochastic oscillator continues to show an overbought USDCAD in the midst of a crossover. Such a signal provides for a retracement lower.
Created Using FX Trek IntelliChart – Prepared by Luis Gil
Written By Luis Gil, DailyFX.com
E-mail: [email protected]
