Canadian Dollar Strengthened at End of Week

July 14th, 2012
in contributors

by Nick Simpson, Forex fx4x

canadian-loonie-reverse-viewSMALLThe Canadian dollar is stronger than its US counterpart over recent trading sessions and has outperformed its currency major rivals. The following 4 hour time frame relative strength chart – where each point is derived from a four hour period – shows the Canadian dollar as the strongest currency. The euro, aussie and U.S. dollar have all faded from earlier relative strength in the last 24-36 hours.  This broad based overview of currency strength is one of our primary tools when analyzing the FX market.

Follow up:

Currency Correlation – Relative Strength 4 Hour Chart

The loonie found strong resistance around the 1.0250 area, a 2-week high, which has multiple daily candle lows in close proximity and has acted as a price pivot.  The USD/CAD pair has declined strongly as commodities pared losses.

We note that the dollar index is trading above the key 83.54 area but do not necessarily see this as a reason to be bullish USDCAD in the near term, as the CAD only has a 9.1% impact on the dollar index (when compared with the 57.6% impact on the dollar index that euro has).

Price action analysis shows a long upper shadow on yesterday's candle. This is also hinting at further potential downside and price is once again trading under the 20 period SMA on the daily chart.

1.0100 is the 5th July daily low and is eyed as potential support on any move lower. Further to this is the cluster of technical levels around 1.0065 to 1.0045. This has the 100 period SMA combined with FE100 and a significant previous resistance level which could subsequently become support. We would be reticent to look for any longs if the CAD continues to outperform the key currencies but would however note this area if in any existing shorts.

US Dollar/Canadian Dollar – Daily Chart

usdcadanalysiscanadiondollarstrongerthanUS thumb CAD Dollar Stronger Than US in Recent Trade – Price Action Update 13th July

(Click on chart for larger image.)

Related posts:

  1. EURUSD Analysis –Euro/Dollar Update 13th July
  2. Gold Technical Analysis – 13th July Forecast
  3. 9th July Dollar Index Technical Analysis Update
  4. Gold Analysis Update 7th July 2012

Related Articles

See Forex Trader articles.

Make a Comment

Econintersect wants your comments, data and opinion on the articles posted.  As the internet is a "war zone" of trolls, hackers and spammers - Econintersect must balance its defences against ease of commenting.  We have joined with Livefyre to manage our comment streams.

To comment, just click the "Sign In" button at the top-left corner of the comment box below. You can create a commenting account using your favorite social network such as Twitter, Facebook, Google+, LinkedIn or Open ID - or open a Livefyre account using your email address.



Analysis Blog
News Blog
Investing Blog
Opinion Blog
Precious Metals Blog
Markets Blog
Video of the Day


Asia / Pacific
Middle East / Africa
USA Government

RSS Feeds / Social Media

Combined Econintersect Feed

Free Newsletter

Marketplace - Books & More

Economic Forecast

Content Contribution



  Top Economics Site Contributor TalkMarkets Contributor Finance Blogs Free PageRank Checker Active Search Results Google+

This Web Page by Steven Hansen ---- Copyright 2010 - 2016 Econintersect LLC - all rights reserved