Current trend
On Wednesday, the USD/CAD pair slightly grew after reaching local lows at 1.2971. The growth was the result of some reduction in risk appetite on the market after the publication of unexpectedly weak Industrial Production data from Germany. In addition, investors are being cautious prior to the release of key economic news. On Thursday, the ECB and Bank of England meetings are due, while the US Fed is going to publish its Minutes later in the day. On Friday, important labour market statistics for September are due in Canada.
Support and resistance
Bollinger Bands on the daily chart is turning downwards, while the price range is widening. The indicator formed a buy signal as the price has left its range. MACD continues its downward movement. Stochastic is in the oversold zone and trying to turn up.
The indicators recommend waiting for clearer trading signals.
Support levels: 1.3053, 1.3000 (psychologically important level), 1.2951 (12 August low), 1.2900, 1.2861 (29 July low).
Resistance levels: 1.3100 (local high), 1.3159, 1.3212, 1.3265, 1.3300 (beginning of September high), 1.3352, 1.3416, 1.3457 (29 September high), 1.3500.
Trading tips
Long positions can be opened after the breakout of the level of 1.3100 with the target at 1.3260 and stop-loss at 1.3030. Validity – 1-3 days.
Short positions can be opened after the breakdown of the level of 1.3000 with the target at 1.2900 and stop-loss at 1.3050. Validity – 2-3 days.