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USDCAD Daily: The bulls are gathering momentum


8 November 2021

The USDCAD market on the Daily time frame had a short but powerful down trend until a last lower bottom was reached on 21 October at 1.22878. After the lower bottom, the bulls started gathering and the price broke through the 15 Simple Moving Average with a critical resistance level forming when a higher top was formed on 27 October at 1.24319. During the same session the bears pulled the market lower but a support level at 1.23001 kept them at bay. On 28 October bulls gathered in even greater numbers than before, signalling a possible change in trend.

USDCAD Daily Chart

The USDCAD broke through the critical resistance level at 1.24319 on 3 November with the Momentum Oscillator confirming the bullish trend by breaking through the baseline into bullish territory.

Three possible price targets were considered from there. Attaching the Fibonacci tool to the top at 1.24319 and dragging it to the bottom of the support level at 1.23001, the following targets was calculated. The first target was estimated at 1.25134 (161.8%). The second price target could be at 1.26452 (261.8%) and the third and final target might be anticipated at 1.28584 (423.6%).

If the support level at 1.23001 is broken, the above scenario is annulled and risk management is paramount. As long as the bulls continue to lead and demand overcomes supply, the outlook for USDCAD on the Daily time frame will remain bullish.

Written on 08/11/2021 by Theunis Kruger, FX Trainer at FXTM
For more information, please visit: FXTM                   
Disclaimer: This written/visual material is comprised of personal opinions and ideas. The content should not be construed as containing any type of investment advice and/or a solicitation for any transactions. It does not imply an obligation to purchase investment services, nor does it guarantee or predict future performance. FXTM, its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness of any information or data made available and assume no liability for any loss arising from any investment based on the same.
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