USD/CAD Daily: Heading up inside Ichimoku Cloud above 23% Fibonacci
Technical Analysis
Three black Crows forex candlestick pattern has formed showing strong bullish sentiment. After failing to break below the 38% Fibonacci level at 1.1990 back in May, and forming a spinning top forex chart pattern at our first pivot level of 1.2180 last week, the pair rallied back up towards our key resistance level of 1.25. Remaining inside the Ichimoku cloud with a bullish sentiment, we could see more up moves back to 1.25 and 1.27 in extension.
Economic Points
US Fed Rate Decision
Rates were left unchanged but Ms USA (aka US dollar) is rallying right now right before the New York session as the FOMC members speak about the Federal Reserve’s looming decisions, including the first potential interest rate increase in a decade, in Washington DC.
Canada
While Canada’s inflation no longer seems to be a problem thanks to its positive correlation to crude oil, the trade activity has fallen short of expectations in the past quarter.
Canada’s employment report for May reflected strong hiring gains of 58.9K, outpacing the consensus of a 10.2K increase. This was enough to keep the country’s unemployment rate steady at 6.8% for the month, even as labor force participation also picked up.
Trading idea
we could see a pullback to 1.23 followed by a rally. Trade bullish above 23% Fibonacci targeting 1.25
Suggested stops and limits:
| Support Levels | Turning Point | Resistance Levels |
|---|---|---|
| 1.1990 | 1.23 | 1.25 |
| 1.1730 | 1.2180 | 1.27 |
*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.
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