(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)
1/04/2010 – USD/CAD – Price action on USD/CAD, a daily chart of which is shown, on the first trading day of the New Year has displayed a marked bearishness that has brought the currency pair back down to dip below strong recent support in the 1.0400 price region. This tentative bearishness exists within the context of both a long-term general downtrend extending from the March 2009 high, as well as a flatter medium-term downtrend extending from at least August of 2009. The last bounce down off the medium-term downtrend resistance line occurred in mid-December. If USD/CAD bearishness is to reign as 2010 commences, a breakdown and close below the noted 1.0400 support could target immediate further support around the 1.0200 region, which represents the long-term low in the pair that was hit in mid-October. To the upside, within the context of the noted medium-term downtrend, dynamic upside resistance continues to reside around the downtrend resistance line.
James Chen, CMT
Chief Technical Strategist
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