Trading news

USD/СAD: Downward movement will continue

Current trend

The pair USD/СAD continues to trade in the downward channel. On Monday the USD had lost over 60 points and reached the level of 1.1044. The American dollar is under pressure from instability in Crimea. Investors believe that tightening of sanction against Russian Federation can result in economic losses in EU and USA; therefore, the USD is sold being out. On the other hand, the USD is supported by the data on volume of industrial output in the USA for February, which was above the forecast reaching the level of 0.6%.

The key news of today is - US consumer price index for February. It is expected that the index will decline from 1.6% to 1.2%, which will support the USD. Important news will become known on Wednesday, when the US fed meeting will be hold.

Levels of support and resistance

In the near future the pair may experience correction to resistance level of 1.1070 (middle moving average of Bollinger bands indicator). However, it is likely that the price will continue to go down to support levels of 1.1035, 1.1010 and 1.0985.

Technical indicators give mixed signals. Bollinger bands are directed downwards, the price chart is moving to the lower moving average line. MACD histogram is in the negative zone and its volumes are increasing. Stochastic lines have crossed and are ready to form a buy signal.

Trading tips

In the current situation it makes sense to place short positions, which can be opened from the current price with profit taking at 1.1010. Pending sell orders can be placed at the level of 1.1070.

(18.03.2013)

 

Dmitry Zolotov
Analyst of LiteForex Group of Companies

Tuesday, 18 Mar, 2014 / 10:52

Source : http://www.liteforex.com/

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