The USD/CAD pair fell initially during the session on Friday, but as you can see formed a nice looking hammer which suggests to us that this area could cause a bounce. That being the case, we think this will simply be consolidation between just underneath the 1.03 handle, and the 1.04 handle above. If that’s going to be the way this market behaves, then buying a break of the top of the hammer is a decent short-term trade, but it won’t be for anything more than about 60 pips, maybe 70 pips before you run into trouble.
Written by FX Empire