USD/CAD Price Analysis: We look for dips to be bought

USD/CAD Price Analysis: There is scope for further losses. We would look at this as an opportunity to get long with support seen between 1.3330 -1.3323

USD/CAD Price Analysis                                 

Market highlights from the last week 

Wednesday June 3: The Bank of Canada maintained interest rates at 0.25 per cent following the latest policy meeting, in line with consensus forecasts

Thursday June 4: The Canadian trade deficit widened to C$3.3bn ($2.5bn) for April from C$1.5bn the previous month with very sharp monthly declines in exports and imports

Friday June 5: The unemployment rate increased to 13.7 per cent from 13.0 per cent, although this was below consensus expectations of 15.0 per cent.

Monday June 8: Canadian housing starts strengthened to 193,500 for May from a revised 166,500 the previous month and well above consensus forecasts of 155,000

Tuesday June 9: Commodity currencies corrected sharply lower, but pared losses as the US currency lost ground

USD/CAD Price Analysis

Let us have a look at the technical viewpoint: 

Monthly: Previous swing high located at 1.4680 (January 2016). Sellers emerged at 1.4667 in March with the subsequent selloff resulting in half the initial monthly gains being overturned. April and May saw rallies being sold into

Weekly: The next Fibonacci downside support is at 78.6 per cent (1.3323). This is close to the previous swing high of 1.3330 (what was resistance, becomes support)

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Daily: Broken out the triangle formation to the downside. The measured move target is 1.3367. This target was accomplished on June 8. 

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Outlook: With the FOMC minutes later today, there is scope for further losses. We would look at this as an opportunity to get long with support seen between 1.3330 and 1.3323

Possible trade setup: 

Action: Buying at 1.3330

Stop: 1.3250

Target: 1.3600

Potential return on risk to first target:  R3.3 (reward 270 / risk 80)

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US Dollar / Canadian dollar
Daily change
1.23787
Low: 1.23555
High: 1.23787

FURTHER READING: USD/CAD price analysis: the bias flips to the upside

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