A noisy neighbor of the Canadian dollar, a blessing or a curse? Weekly review for USD/CAD pair.

Good afternoon, European friends, and those who are in Canada – good night, and I hope that no one was awakened). With you round-the-clock analyst and market analyst ForEx – Andrew Green.

Vague and incomprehensible times have come in the “Canadian Kingdom”. It would seem that a double increase in the discount rate from the Bank of Canada, a confident and strong increase in oil prices, what else is needed to further strengthening of the pair, but no. (For a detailed forecast of weekly oil prospects, see the link). In fact, the pair went into a violent stupor. Having tightened on the decision on the discount rate to levels of 1.2100, the Canadian dollar seemed to gain enough power on the dynamics of oil to break through psychology by 1.2000, however, no. The Canadian dollar is one of the most dependent currency pairs from the immediate state of the US economy. While the entire other market is steadily gaining momentum against the dollar, benefiting from negative movements in American stock markets and sites, the Canadian dollar is also receiving a serious blow to its economic well-being, which is in very close relationship with the “riotous” neighbor, led by Donald Trump. A detailed weekly review of the USD can be viewed by link.

Uncertainty and a large number of negatives for the fundamental state of Canada are provided by the NAFTA situation, which, at the moment, has no concrete solution and development, which generally negatively affects the development of economic relations between Canada and the USA, in which Canada is more a driven member than leading.

As for the economic indicators, those that are expected this week (wholesale sales 20.02.18, 13:30 UTC, retail sales 22.02.2018, 13:30 UTC, inflation report 23.02.18, 13:30 UTC), in the larger degrees can add negative or, at least, doubt for the overall assessment for Canada.

My main expectations for the pair are focused on growth, however let’s take a look at the situation through technical analysis tools.

Let’s start with Figure 1 and a weekly timeframe.

A pair forms by two maxima additional turns for a downtrend, but, as we see, to confirm the dynamics there are not enough forces to form a sequence of falling minima, for this we need a breakdown of 1.2100-1.2000, which is thoroughly complicated. We are waiting for another re-test of the resistance line in the ranges of 1.2700, this level at this stage is the key resistance zone on all timeframes, we will return to it more than once in smaller timeframes.

And in Figure 2, let’s take a closer look at the timeframe H4.

In fact, at this stage in the life of the pair USD/CAD, it gives the current analysis both for medium-term trading in the week and for intraday trading. Our main guidelines are:

• sales from the blue zone at 1.2700
• purchases from the red one 1.2300

Examples of transactions:

• SELL limit 1.2690, SL 1.2740, TP 1.2610
• BUY limit 1.2300, SL 1.2250, TP 1.2380

If you have any questions about the trade recommendation and review, write to the support email of the partner company Ester support@esterholdings.com, marked “for Andrew Green”.

Despite the difficult situation for the Canadian economy, it is an opportunity for us to work with you.

Trade in all directions, do not take away 50% of the opportunities for trade, preferring only one-sided trade. Learn to use the market for 100%.

Andrew Green