USD/CAD Daily Outlook

Daily Pivots: (S1) 1.0390; (P) 1.0435; (R1) 1.0524; More.

USD/CAD's strong rebound from 1.0339 and break of 1.0470 resistance indicates that fall from 1.0671 might be over. Outlook is turned neutral for the moment. Note that after all, USD/CAD is still bounded inside recent of 1.0106/0675. More choppy sideway consolidations might still be seen. Below 1.0339 will bring another fall. But even in such case, we'd expect strong support from around parity to contain downside and bring another rebound. On the upside, decisive break of 1.0675 will suggest that whole rise form 0.9929 is resuming for another high above 1.0851.

In the bigger picture, the failure to take out 1.0675 resistance indicates that consolidations from 1.0851 is still in progress and rebound from 0.9929 is not ready to resume. But in any case, we'd continue to expect strong support from parity to contain downside and finally bring rally resumption. Above 1.0675/0671 resistance zone will target 38.2% retracement of 1.3063 to 0.9929 at 1.1126 at least, with prospect of extending further to 61.8% retracement of 1.1866. However, sustained trading below parity will indicate 0.9929 is not yet the bottom and will turn focus back to this low.

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