usd cad 11 Nov 2009

usd cad 11 Nov 2009

Another down day for the usd to cad pair, and with the recent rally now consigned to history, the bearish tone has been firmly reestablished once again, a view reinforced by the crossing of the 9 day and 40 day moving averages giving a bear cross signal. With daily prices now well below the recent sideways consolidation, this now presents a formidable barrier to any move higher, and with all three moving averages now weighing heavily on the daily chart, the only question remains whether the 1.02 price level will provide any kind of platform for a bounce back. Given the bearish technical picture both for the usd to cad and also the US dollar, this seems unlikely at present, and with the bearish engulfing signal of Monday still very dominant the outlook remains bleak for usd to cad bulls in the short to medium term.

The only item of fundamental news on the economic calendar for Canada has been the NHPI Index (change in the selling price of new homes) which has come in stronger than expected at 0.5% as opposed to a forecast of 0.2%.  Meanwhile in the US the unemployment claims have come in better than expected at 502k and later today we have the crude oil inventories (delayed by one day owing to Veterans Day holiday in both Canada and US).

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Support & Resistance for USD/CAD

S1: 1.0419   R1: 1.0489

S2: 1.0390  R2: 1.0530

S3: 1.0349   R3: 1.0559