USD/CAD Candlesticks and Ichimoku Analysis
|
Last Candlesticks pattern |
Time of formation |
Trend bias |
| Weekly |
Morning star |
Nov 2007 |
Sideways |
| Daily |
Shooting star |
1 Apr 2009 |
Down |
The greenback continued to move higher and finally rose above the Ichimoku cloud bottom on the weekly chart, suggesting the decline from 1.3066 has indeed formed a low at 1.0784 earlier and price has just tested the Tenkan-Sen and looks like it is going to head to 1.1654 (38.2% Fibonacci retracement of the decline 1.3066 to 1.0784), then towards the Ichimoku cloud top (currently locating at 1.1869), however, 1.1924 (confluence point of the Kijun-Sen as well as the 50% Fibonacci retracement level) is expected to cap the currency pair's upside.
On the downside, after touching the Tenkan-Sen, it is quite common to see some initial pullback but downside is likely to be limited to 1.1365 (current level of Ichimoku cloud bottom) and reckon 1.1230/40 would hold and bring further rise to abovementioned upside targets. Only below 1.1180/85 would indicate the rebound from 1.0784 has ended instead and fall to 1.1000 would follow, however, it is necessary to see the greenback dropping below 1.0940/45 to confirm this view and then another leg of the descend from 1.3066 would take place thereafter.
On the daily chart, although the U.S. dollar retreated after rising to 1.1450 last week, the currency pair found good buying interest at 1.1234 (just above the Tenkan-Sen) and resumed the rise from 1.0784 on Monday, the 'Marubozu' candlestick formed on the daily chart suggests bullishness remains for this upmove to bring stronger correction of recent decline to 1.1650/55, however, price should falter well below 1.1815/20, being a previous chart resistance as well as the current level of the Ichimoku cloud bottom.
On the downside, whilst pullback to 1.1400 is likely, renewed buying interest should emerge above 1.1330/40 and bring another rally to abovementioned upside targets. If the greenback falls below Tenkan-Sen (now at 1.1249), this would suggest the first leg of correction from 1.0784 has ended and fall to 1.1100 cannot be ruled out but support at 1.0942 should hold and bring another rebound.
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