USD/CAD:Rounding top pattern is in process of formation

Aug 1 , 2018

 

By observing the daily technical chart we can see that earlier pair was making successively higher highs and higher lows by taking the support from an uptrend line. But after arriving 1.3380 level it stopped and  slipped down to 1.3012 level. Well in the recent selloff the uptrend line has been breached out which means there are no more bullish sentiments.

 

From technical prospective we can see that the way supply is going on the pair is forming rounding top pattern on the daily technical chart which is an early signal for sellers.The formation of candles below the moving average line is generating bearish signal.

 

 

 

 

The bearish engulfing candlestick followed by bearish marabuzo candlestick is generating bearish signal and it’s just  a starting the further downfall is still expected. Odds are in favor of bears and intraday bias remains bearish on the pair as long as 1.3270 level.The way bears are reacting it seems like they are appraoching the 1.2700 level in short term.

 

 

The RSI along with MACD indicators are also favoring the bearish sentiments. A bearish divergence on RSI indicator is providing clear confirmation of trend reversal signal.We have mentioned in our previous report about the divergence and we got sell signal at an early stage and we were right at that time. The 1.2721 level is the key support level followed by 1.2650 level where as 1.3050 level is the key resistance level followed by 1.3150.

 

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