USD/CAD Candlesticks and Ichimoku Analysis

The greenback finally penetrated recent low at 1.0206, confirming our view that medium term downtrend from 1.3066 has resumed and indicated downside target at 1.0100 has been met and further weakness to psychological support at 1.0000 would be seen, below would extend to 0.9932 (61.8% projection of 1.1725 to 1.0206 measuring from 1.0871) and possibly towards support at 0.9711, however, price should stay well above 0.9441-43 (50% projection of 1.3066 to 1.0206 measuring from 1.0871 and 100% projection of 1.3066 to 1.0784 measuring from 1.1725).

On the upside, whilst recovery to 1.0206 (previous support turned resistance) cannot be ruled out, price should falter below the Tenkan-Sen (now at 1.0425) and bring such a decline to aforesaid downside targets. Only a break above the Tenkan-Sen would suggest a temporary low is possibly formed and risk correction to the Kijun-Sen (now at 1.0532) but resistance at 1.0781 should remain intact

On the daily chart, although the greenback staged a brief bounce to the Tenkan-Sen, renewed selling interest quickly emerged at the Tenkan-Sen and tumbled again, the breach of indicated support at 1.0206 confirms downtrend has resumed and met our indicated downside target at 1.0100, bearishness remains for further weakness to psychological support at 1.0000 and then 0.9932 (61.8% projection of 1.1725 to 1.0206 measuring from 1.0871) but reckon 0.9736 (1.618 times projection of 1.0871-1.0225 measuring from 1.0781) would hold from here and bring correction later.

On the upside, although recovery to the Tenkan-Sen (now at 1.0201) and possibly 1.0225 (previous support turned resistance) is likely, price should falter well below 1.0371 (previous support turned resistance) and bring such a decline to aforesaid downside targets. Only a daily close above the Kijun-Sen (now at 1.0389) would suggest a temporary low is in place and risk correction to the Ichimoku cloud bottom (now at 1.0503) but the upper Kumo (now at 1.0583) should hold.