Week ending October 1, 2021
CAD / USD:
(Italics: previous analysis)
Last week, a handshake with prime support at $ 0.6968-0.7242, in the form of a doji candle, points out that the previous decline is losing strength and an upward reversal could be on the menu.
Failure to order the position 0.6968 at $ 0.7242 opens support at $ 0.6673. Regaining buyers still have first-rate resistance at $ 0.7849-0.7599 to target.
Weekly scale trend studies show we are higher since the start of 2020. Therefore, the response of $ 0.6968 to $ 0.7242 could be the start of a downward buy attempt to join the current trend.
Attention remains focused on Fibonacci support at $ 0.7057-0.7126 and major resistance at $ 0.7506-0.7474 this week.
Beyond the aforementioned areas is support turned Quasimodo resistance at $ 0.7621 and the 200 day simple moving average at $ 0.7594. Nearby, we also note a 100% Fibonacci projection at $ 0.7604, a 61.8% Fibonacci retracement at $ 0.7585, and a 1.618% Fibonacci extension at $ 0.7644.
On the downside, support also falls around $ 0.7021.
Those following the Relative Strength Index (RSI) will recognize that the indicator is zeroing on the center line of 50.00, coming from below. Passing over the latter signals that momentum is on the rise.
The resistance of $ 0.7317 held in the second half of the week, in play since late July. Upstream, the stacked offer remains between $ 0.7347 and $ 0.7376, as well as Quasimodo’s resistance at a short distance at $ 0.7394.
Also on the technical radar this week, a decision point at $ 0.7200-0.7218. The areas that shape decisions are, according to research, best used directly after training. In this case, the base was not tested within a month of establishing the position, so with immediate sentiment – in the form of lower technical lows and higher highs – versus $ 0.7200-0.7218 , there is more chance of a breakout.
If we are looking to move lower, Quasimodo support at $ 0.7144 is in sight, which has associated with a Deep 88.6% Fibonacci retracement to $ 0.7146.
Aided by the H4 resistance highlighted above at $ 0.7317, an H1 Fibonacci cluster between $ 0.7320 and $ 0.7315 welcomed a misstep above the big figure of $ 0.73. This was a manual stop race, a practice that trapped breakout buyers (bull trap) and filled the stops of those trying to do away with the round number.
While it took some time for sellers to organize after the $ 0.73 boost, sellers fell on Friday, weighed down by a risk-averse market, boosting US Treasury yields and a reasonably USD. robust. As you can see, bearish momentum stabilized as US hours approached with a handful of pips north of support reaching $ 0.7221 (ahead of Quasimodo support at $ 0.7205 and round number 0 , $ 72).
Technical levels observed:
The weekly schedule of a half-hearted doji candle at major support at $ 0.6968-0.7242 demonstrates potential interest on the long side.
Still, on the other side of the close, the daily calendar is letting us know about the possibility of moving closer to Fibonacci support at $ 0.7057-0.7126. Thus, traders are urged to consider the possibility of digging deeper into the weekly support this week.
With first half support at $ 0.7221 capping the decline since late August, the level should generate interest. That said, Quasimodo’s H1 support at $ 0.7205 and the $ 0.72 figure – both located in the H4 decision point at $ 0.7200-0.7218 – may attempt a pretense south of $ 0.7221.
The price drop below $ 0.7221 and the test of $ 0.7205, as well as the impression of a first half close above $ 0.7221, could be enough to attempt a bullish wave, according to to the weekly main support outlined above.