USD/CAD:Acid test for bulls at resistance level

June 11 , 2018

 

Earlier bulls were heading north side aggresively and making higher highs and higher lows but after arriving at 1.3067 level they are struggling to move up further due to strong supply zone as it is previous swing’s high. However, bears are not able to convert this opportunity and pair is still hovering at that level. The 1.3093 level  is a make or break level. A valid breakout of this resistance level will open the way towards the 1.3250 level and a downfall from this level will put the pair at 1.2850 level and then  bears will get active.

 

Jobs data from Canada indicated that during May employment slipped by 7.5K and the unemployment rate remained at 5.8% and the Capacity Utilization Rate came in at 86.1%. Another report explained that Housing Starts arrive at 195.6K units. Employment and housing data approached in below estimates. Despite the data there is high probability of rate hike from the Bank of Canada in the coming months. Those expectations supported the pair in the market.

 

 

Presently pair is trading above all the major and minor moving averages and heading north side. Odds are in favor of bulls and we will keep our bias bullish on the pair as long as 1.2750 level remains intact. Presently pair is consolidating near the supply zone but we are expecting a bullish breakout.  A clear bullish breakout on MACD indicator is also favoring the bulls and generating bullish signal. RSI is also supporting the bulls from the positive territory. The 1.3100 level could be seen as immediate resistance level followed by 1.3250 level whereas 1.2750 level is strong key support level followed by 1.2700.

 

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