Daily candle chart - usd to cad forex pair 18th March 2010
The usd to cad continued to grind lower yesterday once again, ending the currency trading session with a narrow spread down candle, closing below all three moving averages and with a small wick to the lower body. The bearish move lower has been remorseless in the last few weeks as the usd to cad has slid ever lower in a series of small steps, with the break below the 1.02 region of particular significance as we represented the last area of potential support to any further fall. Indeed this area had previously triggered a rally higher, but on this occasion failed to provide any brake to the heavily bearish picture, which now indicates a period of further pressure on the pair as we approach 1.00 once again. With all four moving averages now pointing firmly lower, and with the deep and sustained price congestion now above, there is only one way to trade the usd to cad pair at present, and that is to the short side. However, as word of caution before we all build increasingly heavy trading positions, there is a substantial area of price support awaiting in the 1.0 price area and this could provide the much needed platform for the pair to re base and bounce higher in the medium term. Any breach of this area however, will suggest a much deeper move is in prospect possibly even as far as 0.94 in the longer term. However, in the meantime, enjoy riding the down escalator, and continue to lock in profits with trailing stops as we go.
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