Economic Points
The US Retail Sales came in as expected on Thursday at 0.6% while unemployment claims rose slightly form the expected 272K to 274K. The chaos from Chinese Yuan devaluation seems to already been shrug off by market participants and Ms. USA went back to to where she was on Tuesday against her major dancing partners. Tomorrow we will be looking at Canada’s Manufacturing Sales and US PPI first thing during the New York trading session.
Read this to learn how the US dollar reacted to Chinese Yuan devaluation and this to learn what we could expect from the Fed in September in terms of rate hike perspectives.
Technical Analysis
After reaching our target of 1.30 and breaking above the neckline of a saucer bottom chart pattern at 1.28 on the monthly forex dance floor, the US dollar versus the Canadian dollar (USD/CAD pair) is now consolidating back around the (now support level) of 1.30. The pair remains above the Ichimoku Cloud and we could even see drops back to the 23% Fibonacci at 1.29 before the next wave of bullish dance moves. Our targets are set at 1.3250 and 1.37 in extension.
Alternative Scenario
From a long term percpective, a break below 1.22 would change our outlook to bearish with 1.1950 as first alternative target
Suggested stops and limits
| Support Levels | Turning Point | Resistance Levels |
|---|---|---|
| 1.22 | 1.30 | 1.3250 |
| 1.1950 | 1.28 | 1.37 |
*Important Note: The support and resistance levels are not suitable for all traders and largely depend on your account size, margin and leverage. Book a private lesson to learn how to personalize your account based on our trading guide.
#1 Best Selling Author. Helping you accelerate your retirement with Triple Compounding™ Former engineer on a mission to help 1 million households take control of their finances. Founder & CEO of Invest Diva.
