Trade of the Day: USD/CAD
By: Dima Chernovolov
USD/CAD continues to rise inside the 4-hoiur Down Channel chart pattern which was previously identified by Autochartist. Autochartist rates the quality of Down Channel at the 7-bar level – which is the result of the below-average Initial Trend (3 bars) and strong Uniformity and Clarity (8 bars). USD/CAD is expected to rise further inside this Down Channel – in line with the earlier upward reversal form the support area shown below.
As can be seen from the daily USD/CAD chart below –, the price earlier reversed up from the key support area lying between the long-term support level 1.2600 (monthly low from January) and the lower daily Bollinger Band. The proximity of this support area and the bullish divergence on the daily Stochastic indicator add to the probability USD/CAD will continue to rise inside this Down Channel.