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USDCAD builds base

The Canadian dollar steadied after inflation eased more than expected in December. From the daily chart’s perspective, the pair is still in a prolonged consolidation between 1.3230 and 1.3800. A bounce off the daily support at 1.3320 may lead to a narrower range. A close above the immediate hurdle at 1.3450 would attract more intraday interests and carry the price to the support-turned-resistance at 1.3560. Stiff selling could be expected from there to the previous swing high of 1.3660 as range trading lives on.

NZDUSD tests resistance

Chart of NZDUSD

The New Zealand dollar rallies as overall risk appetite grows. The pair has consolidated its recent gains above the former resistance at 0.6350. The choppy rise reveals a lack of momentum as the price inches towards the supply zone around 0.6460. Its breach could pave the way for a bullish continuation above 0.6510. Otherwise, the bears may take over in the near term. 0.6330 is an area of congestion and its break would shake some buyers out and send the kiwi to the latest daily low at 0.6190.

UK 100 keeps high ground

Chart of UK100

The FTSE 100 pushes higher as financial stocks roar. On the daily chart, the index has gone parabolic after breaking last year’s top of 7670. The RSI’s double top in the overbought area may lead to a slowdown in the momentum. The bearish RSI divergence on the hourly chart corroborates the possibility of exhaustion. 7810 is the first support to see whether the bulls can sustain their bids at these fresh high levels and push to 7900. A bearish breakout could trigger broader profit-taking and possibly mean reversion towards 7730.

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