USD/CAD Candlesticks and Ichimoku Analysis

Weekly
    •    Last Candlesticks pattern: Shooting doji
    •    Time of formation: 01 May 2017
    •    Trend bias: Sideway

Daily
    •    Last Candlesticks pattern: Bearish engulfing
    •    Time of formation: 5 May 2017
    •    Trend bias: Down



USD/CAD – 1.2740




The greenback has edged higher after recovering from 1.2414, retaining our view that consolidation above this level would be seen and although gain to 1.2770-75 cannot be ruled out, reckon upside would be limited to 1.2805-10 and bring another decline later, below the Tenkan-Sen (now at 1.2584) would bring weakness to 1.2500-05, however, break of said support at 1.2414 is needed to confirm decline has resumed and extend weakness to 1.2350-60 and later towards 1.2300 but price should stay well above 1.2240-50, risk from there has increased for a rebound to take place later. 

On the upside, whilst initial recovery to 1.2770-75 cannot be ruled out, reckon upside would be limited to 1.2800-10 and bring another decline later. Above previous support at 1.2859 (now resistance)  would defer and suggest a temporary low is formed instead, bring a stronger rebound to 1.2900-05, however, still reckon upside would be limited to 1.2940-45 and price should falter below resistance at 1.3015. 

Recommendation: Sell at 1.2800 for 1.2600 with stop above 1.2900.


On the weekly chart, last week’s rebound formed a white candlestick, retaining our view that consolidation above support at 1.2414 would be seen and initial upside risk remains for recovery to 1.2770-75, however, still reckon upside would be limited to 1.2800-05 and bring another decline later. Below 1.2600 would bring weakness to 1.2550, then 1.2500, however, break of support at 1.2414 is needed to signal medium term fall from 1.4690 top has resumed and extend weakness to 1.2300-10 but oversold condition should prevent sharp fall below 1.2240-50 and price should stay above 1.2175 (61.8% Fibonacci retracement of 1.0621-1.4690). 

On the upside, although initial recovery to 1.2770-75 cannot be ruled out, reckon upside would be limited to 1.2805-10 resistance and bring another decline later. Above previous support at 1.2859 (now resistance) would suggest a temporary low is possibly formed, bring a stronger rebound to 1.2900, then towards resistance at 1.2944, however, reckon the Tenkan-Sen (now at 1.2978) would hold. Only a weekly close above the Tenkan-Sen (now at 1.2978) would shift risk to upside for a strong rebound to to 1.3015 resistance, then 1.3050-60 but price should falter below the Kijun-Sen (now at 1.3104) and bring another selloff in late Q3.