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Talking Points:
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USD/CAD Technical Strategy: Flat
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Support: 1.1204 1.1092 1.1002
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Resistance: 1.1329 1.1406 1.1483
The US Dollar may be topping against its Canadian counterpart as negative RSI divergence warns of ebbing upside momentum. Near-term term support is at 1.1204 the intersection of a rising channel floor and the 23.6% Fibonacci retracement with a break below that on a daily closing basis exposing the 1.1092-98 zone (38.2% level September 15 high). Alternatively a reversal above the 38.2% Fib expansion at 1.1329 opens the door for a challenge of 1.1406 marked by the 23.6% threshold and the channel top.
Positioning is inconclusive. RSI divergence is not an actionable signal by itself and confirmation is needed via invalidation of the uptrend from September’s lows. With that in mind we will remain flat for now until greater clarity emerges.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak Currency Strategist for DailyFX.com
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