Trade of the Day: USD/CAD

By: Dima Chernovolov

USD/CAD continues to rise inside the hourly Up Channel chart pattern, which was previously identified by Autochartist. Autochartist rates the quality of Up Channel at the 4-bar level – which is the result of the slow Initial Trend (1 bar), low Uniformity (2 bars) and near-maximum Clarity (8 bars). USD/CAD is expected to rise further inside this Up Channel – in line with the earlier upward reversal from the support area shown below.

As can be seen from the daily USD/CAD chart below, the price earlier reversed up with the daily Morning Star from the support area lying between the key support level 1.2630 (which has been reversing the price from the start of June) and the lower daily Bollinger Band. The proximity of this support area and the bullish divergence on the daily Stochastic indicator increase the probability USD/CAD will continue to rise inside this Up Channel.