USD/CAD Basing off Consolidation Support and Breaking Trendline

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USD/CAD Basing off Consolidation Support and Breaking Trendline

The USD/CAD has been consolidating since May after it found support at 1.0814. It has ranged up to 1.0960. In June so far, traders have been trading down the USD/CAD from the 1.0960 high down to 1.0840 to start this week.

USDCAD 4H chart 6/16
usdcad 6/16

As we get into the 6/16 US session, USD/CAD formed a price bottom above 1.0840. With a break above 1.0870, it completed a small double bottom, and broke above a falling trendline from the 1.0960 high.

Price action shows it is ready for a bullish cycle within the consolidation mode usd-cad has been in for over a month. Watch out for some intra-session resistance at 1.09. If price can hold above 1.0860, the 1.0940 and 1.0960 highs are exposed in the near-term. Below 1.0860, the focus will remain on the consolidation support area above 1.0814.

USDCAD Daily chart 6/16
usdcad 6/16 daily chart

Looking at the daily chart, we see that the month-long consolidation followed a bearish correction from the 2014-high of 1.1278. If price falls below 1.0814, this bearish correction mode would continue, and the 1.0737 and 1.0560 pivots would be exposed.

To the upside, a break above 1.10 would probably be needed to open up the 1.1224 to 1.1278 highs.

To contact the reporter of this story, email Fan Yang at fan@forexminute.com
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Fan Yang has been a professional forex trader and analyst since 2007. He specializes in technical analysis and has a Chartered Market Technician designation since 2011. He was the chief technical strategist at CMSFX He was also the founder and chief currency strategist at FXTimes Over the years, Fan has not only been a trader and analyst but also an educator. As a proponent of both technical and fundamental analysis in trading, Fan advocates simplicity and discipline as key factors in making trading decisions when faced with so many "clues" and "signals". Currently Fan Yang is the chief currency analyst and webinar instructor at forexminute.com.