Trade of the Day: USD/CAD

By: Dima Chernovolov

USD/CAD continues to rise inside hourly Down Channel chart pattern which was previously identified by Autochartist. Autochartist rates the quality of Down Channel at the 5-bar level – which is the result of the slow Initial Trend (1 bar), below-average Uniformity (4 bars) and strong Clarity (8 bars). USD/CAD is expected to rise further inside this Down Channel – in line with the earlier upward reversal from the support area show below.

As can be seen from the daily USD/CAD chart below, the price earlier reversed up from the support area located between the key support level 1.2630 (which reversed the pair 3 times last month) and the lower daily Bollinger Band. The proximity of this support area and oversold daily Stochastic add to the probability USD/CAD will continue to rise inside this hourly Down Channel.