The USD/CAD pair bounced off of the parity level yet again on Wednesday, and rose to finish the day higher than the previous two highs from the last week and half or so. This is starting to look more like a market is trying to break out, and as such we are willing to start buying at this point. We believe that the strength in this market will continue to show itself, as even with the oil markets appreciating during the session, the Canadian dollar gained no real traction.
Looking at this chart, we think that the previous long-term consolidation area could be repeated. This area extended from the 0.99 level all the way up to the 1.04 handle. Because of this, we look at this is a high risk to reward ratio type of trade, and as such are willing to start buying. We believe as long as we are above the 0.99 handle, we will continue to see upward pressure in this market.
Written by FX Empire