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Loonie continues to make new highs

al_dcdemo Posted 12 Jan.  in #Trader's blog #Support #Resistance #USD/CAD #Uptrend #H1 Chart #Thirteen Year Highs
Loonie continues to trend up strongly and has broken to a new high in five out of six completed trading days this year. Yesterday, it reversed from the dip and proceeded to break July 2003 high, making it to the highs not seen for thirteen years.
76.4% retracement of the 2002 to 2007 decline is the next target, reinforced by the big figure level at 1.45 and backed by the March 2003 low (~1.4580). Pullbacks have been shallow but, in case of a deeper correction, area around 1.35 (September 2015 hi…
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USD/CAD to pull back before continuation higher

al_dcdemo Posted 30 Dec. as Analysis on USD/CAD, Target: 1.3925, Date: 1st of February, 12:00 GMT  in #Technical analysis #Oil #USD/CAD #Confluence #New High #Uptrend #Pullback #Strong Rally #Major Levels #Upside Potential
Monthly chart
The pair is in uptrend since 2011. It broke above 38.2% retracement (of the 2002 to 2007 decline) in January and then traded around 50.0% retracement for nearly three months. In April, the pair pulled back deep enough to clear stops below 1.20. The confluence of the broken trendline (drawn off 2003, 2004 and 2009 highs) and 38.2% retracement wasn't even properly retested before the pair resumed the uptrend, touching 1.40 level in December.
Weekly chart
Since revisiting 1.20 level …
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al_dcdemo 11 Jan.

UPDATE 5: There was quite a lot of movement for a Monday right after the open. Moves across major pairs were similar with the dollar gaining against higher yielding currencies and losing against lower yielding ones. The moves were then more or less reversed. Loonie appears to have been the quietest of the bunch as its overnight range was barely more than 30 pips.

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al_dcdemo 12 Jan.

UPDATE 6: Loonie continues to trend up strongly and has broken to a new high in five out of six completed trading days this year. Yesterday, it reversed from the dip and proceeded to break July 2003 high, making it to the highs not seen for thirteen years. 76.4% retracement of the 2002 to 2007 decline is the next target, reinforced by the big figure level at 1.45 and backed by the March 2003 low (~1.4580). Pullbacks have been shallow but, in case of a deeper correction, area around 1.35 (September 2015 high) may be the first candidate for support.

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al_dcdemo 18 Jan.

UPDATE 7: Currencies opened the week with with risk-off gaps: euro, franc and yen gained about 10 pips, pound lost a couple of pips while commodity currencies lost 20-60 pips. All gaps have been already closed as risk sentiment improved. U.S. banks will be closed today in observance of Martin Luther King Day - that means thin liquidity and tight ranges but not without a possibility of an outsized move.

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al_dcdemo 21 Jan.

UPDATE 8: Contrary to what many expected, BOC held the overnight rate at 0.50%. Canadian dollar weakened a lot in anticipation of their move and was bought heavily after the decision. The pair (USD/CAD) was marked down immediately but it turned around swiftly and retested pre-meeting range in anticipation of a dovish press conference. That never came and the pair continued lower, leaving a big reversal candle on the daily chart.

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al_dcdemo 25 Jan.

UPDATE 9: Major currencies opened with gaps again but this time around with smallish ones in what appears to be the quietest open so far this year. Improvement in risk sentiment seemed to come after China managed to stabilize its currency and stock market. Given the magnitude of the bounce in stocks, oil and risk sensitive currency pairs it seems that an interim bottom may be in place. However, all macroeconomic themes are still ongoing, so it may be too early to speak of a reversal.

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USD/JPY to trade lower in January

al_dcdemo Posted 30 Dec. as Analysis on USD/JPY, Target: 119.25, Date: 1st of February, 12:00 GMT  in #Technical analysis #USD/JPY #Uptrend #Spike #Yen Strength #Stimulus Program #Resistance Cluster #Sell Off #50 Week Sma #Short Lived Recovery
Monthly chart
The pair broke above a strong cluster of resistance (trendline that contained long-term downtrend in years 1986, 1990, 1998; 23.6% retracement of the 1982 to 2011 decline; 2007 high at 124.14). The pair retested the cycle-high (~125.85) in August before it sold off strongly amid concerns about global growth, China slowdown, oil prices and Fed tightening. It retraced most of the losses but has been unable to get above 124.00.
Weekly chart
In the last week of August the pair broke b…
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al_dcdemo 9 Jan.

UPDATE 5: U.S. labour market report for December came out much stronger than expected as implied by ADP Non-Farm Employment Change which was released on Wednesday. Knee-jerk was to buy the dollar but moves were quick to reverse in lower yielding currencies. A classical risk-off mode that will likely continue well into next week and perhaps beyond it, all things being equal.

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al_dcdemo 11 Jan.

UPDATE 6: There was quite a lot of movement for a Monday right after the open. Moves across major pairs were similar with the dollar gaining against higher yielding currencies and losing against lower yielding ones. The moves were then more or less reversed. USD/JPY lost some 50 pips and traded down to Daily Support 1 (116.70) before turning back up and recouping the losses.

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al_dcdemo 18 Jan.

UPDATE 7: Currencies opened the week with with risk-off gaps: euro, franc and yen gained about 10 pips, pound lost a couple of pips while commodity currencies lost 20-60 pips. All gaps have been already closed as risk sentiment improved. U.S. banks will be closed today in observance of Martin Luther King Day - that means thin liquidity and tight ranges but not without a possibility of an outsized move.

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al_dcdemo 21 Jan.

UPDATE 8: The Yen continues to make lower lows and lower highs. Today, it briefly traded below August 2015 low (~116.20) and pierced 116 level which is an upper extreme of a strong 115.5 - 116 support zone. The support zone is a neckline of a big head and shoulders pattern on the weekly chart. If it gives way, measured move would target 105 - 107 which also includes 38.2% retracement of the 2011 - 2015 uptrend (~106.65), 2013 high (~105.5) and October 2014 low (~105.2).

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al_dcdemo 25 Jan.

UPDATE 9: Major currencies opened with gaps again but this time around with smallish ones in what appears to be the quietest open so far this year. Improvement in risk sentiment seemed to come after China managed to stabilize its currency and stock market. Given the magnitude of the bounce in stocks, oil and risk sensitive currency pairs it seems that an interim bottom may be in place. However, all macroeconomic themes are still ongoing, so it may be too early to speak of a reversal.

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USD/CAD may have enough fuel for a new high

al_dcdemo Posted 21 Nov. as Analysis on USD/CAD, Target: 1.3375, Date: 1st of January, 12:00 GMT  in #Technical analysis #Oil #USD/CAD #Confluence #Range #Uptrend #Momentum #Pullback #Strong Demand #Second Wave
Monthly chart
The pair is in uptrend since 2011. It broke above 38.2% retracement (of the 2002 to 2007 decline) in January and then traded around 50.0% retracement for nearly three months. In April, the pair pulled back deep enough to clear stops below 1.20. The confluence of the broken trendline (drawn off 2003, 2004 and 2009 highs) and 38.2% retracement wasn't even properly retested before the pair resumed the uptrend.
Weekly chart
During the pullback in late April and early May, lower tails …
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al_dcdemo 26 Nov.

UPDATE 3: Loonie surged through 1.34 on Monday and traded up to 1.3435. High for the year, set in late September at 1.3457, held. The oil rebounded on Friday and has not posted a losing day since. If the commodity stays supported, the pair is unlikely to break to new highs. In that case, a retest of 50 and 100 DMA (1.3150 - 1.3200) seems the most likely scenario. Otherwise, 1.34 level will need to be convincingly broken to make a push through the cycle-high feasible.

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al_dcdemo 27 Nov.

UPDATE 4: Canadian dollar lost about a quarter of a cent against the U.S. dollar and closed in the middle of the range. The pair's range was somewhat larger this week than in the previous one but overall price action was pretty much the same. Needless to say, the pair tracked oil prices which rose in the first three days of the week only to then give back most of the gains in the last two days.

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al_dcdemo 29 Nov.

UPDATE 5: Week ahead is big for Canadian currency too. GDP release will be followed by BOC meeting and labour market report. On top of that, U.S. will publish ISM Manufacturing PMI, ISM Non-Manufacturing PMI and NFP report. Attempt to break to new eleven-year highs early in the past week failed and the pair pulled back but based ahead of 1.3275. Higher lows during the best part of the month highlight the bullish bias.

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al_dcdemo 7 Dec.

UPDATE 6: Loonie finally broke through strong resistance band between 1.3450 and 1.3500, which includes September high (~1.3460), 61.8% retracement of the 2002 to 2007 decline (~1.3470) and the big figure. The breakout accompanied the sell-off in oil, which has put the commodity to new six-year lows. 1.3530 and 1.3680 are the two minor chart levels from June 2004 before 1.3820 (June 2004 high) and 1.4000 (May 2004 high). Depending on action in oil, 1.3375 - 1.3450 seems like a good support zone.

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al_dcdemo 17 Dec.

UPDATE 7: After months of preparations, FOMC finally decided to hike federal funds rate. The rate was at the record low of 0 - 0.25% for the past seven years (since December 2008). Last time that the rate was hiked was nearly ten years ago (in June 2006). New band for the rate is 0.25% - 0.50%. A couple of hours before the decision, much weaker than expected crude oil inventories report sent the Loonie to new eleven-year high (~1.3850), above the June 2004 high (~1.3820). The decision led to several whipsaws but the pair ended right where it started. The pair remains supported ahead of 1.3775.

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USD/JPY to stay supported

al_dcdemo Posted 21 Nov. as Analysis on USD/JPY, Target: 121.2500, Date: 1st of January, 12:00 GMT  in #Technical analysis #USD/JPY #Recovery #Uptrend #Spike #Stimulus Program #Resistance Cluster #Sell Off #50 Week Sma #Unclear Direction
Monthly chart
The pair broke above a strong cluster of resistance (trendline that contained long-term downtrend in years 1986, 1990, 1998; 23.6% retracement of the 1982 to 2011 decline; 2007 high at 124.14). After a weak pullback in June, the pair retested the cycle-high (~125.85) in August before it sold off strongly amid concerns about global growth, China slowdown, oil prices and Fed tightening.
Weekly chart
In the last week of August the pair broke back below the monthly resistance cluster …
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al_dcdemo 29 Nov.

UPDATE 5: Japan will release several lower-tier indicators next week but nothing market moving. U.S. macroeconomic data released in the week ahead includes: ISM Manufacturing PMI, ISM Non-Manufacturing PMI and NFP report, plus a testimony from Fed's Yellen. Unless the data or the ECB or any external shock makes it move, the pair will likely stay in its recent (122 - 124) range until Friday (NFP).

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al_dcdemo 8 Dec.

UPDATE 6: Final revision of Japanese GDP showed that the economy expanded in Q3 rather than contracted. Worries that the country entered a recession were diluted last week after much better than expected capital spending report. This may put some downside pressure on the pair. Technically, the pair has been confined to a 150 pip range (122.25 - 123.75) for nearly a month. 50, 100 and 200 DMA, which are just about to converge, are a part of support band between 121.50 and 122.00. 124.00 - 124.25, which includes a trendline drawn off of June and August highs, may prove to be a decent resistance.

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al_dcdemo 16 Dec.

UPDATE 7: Sentiment in stock markets improved today while ten-year U.S. treasury yield gained 7bp. In addition, there was a broader U.S. dollar buying throughout the second part of the day - a lot if it must have been position adjustment ahead of tomorrow's big event. USD/JPY rallied 120 pips from the lows and gained nearly 70 pips on the day after it bounced from the trendline, drawn off of August and October lows. The pair is currently trading just above the confluence of 50, 100 and 200 DMA (~121-50), which will need to stay above if it wants to improve technical picture.

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al_dcdemo 28 Dec.

UPDATE 8: This week is probably the lightest one for the year with regard to economic data and certainly the most holiday-packed. There's nothing on the calendar from Japan, after Retail Sales and Industrial Production data were released earlier today. U.S. will publish CB Consumer Confidence, Unemployment Claims and Chicago PMI, which may contribute to some volatility in these thin conditions.

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al_dcdemo 29 Dec.

UPDATE 9: Last two weeks of a year are known to be the quietest in most markets. Low participation means low liquidity and usually low volatility. However, it's easier to move markets in such conditions and if someone decides to execute a big order, the move could be big too. That move is more often than not faded or at least retraced to a great extent as liquidity returns.

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USD/CAD pullback to continue

al_dcdemo Posted 31 Oct. as Analysis on USD/CAD, Target: 1.2925, Date: 1st of December, 12:00 GMT  in #Technical analysis #Oil #USD/CAD #Reversal #Confluence #Uptrend #200 Day Sma #Strong Demand #Weak Fundamentals #Second Wave
Monthly chart
The pair is in uptrend since 2011. It broke above 38.2% retracement (of the 2002 to 2007 decline) in January and then traded around 50.0% retracement for nearly three months. In April, the pair pulled back deep enough to clear stops below 1.20. The confluence of the broken trendline (drawn off 2003, 2004 and 2009 highs) and 38.2% retracement wasn't even properly retested before the pair resumed the uptrend.
Weekly chart
During the pullback in late April and early May, lower tails o…
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al_dcdemo 22 Nov.

UPDATE 4: Canadian dollar was among those major currencies that lost against the U.S. dollar in the past week. It lost half a cent while the weekly range was about a cent and a quarter wide. Needless to say, price action in the pair was mostly range bound. Volatility in the pair is contracting what may also be a sign that we are nearing usually less active December.

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al_dcdemo 23 Nov.

UPDATE 5: There's nothing particularly of note on the calendar for the week ahead from Canada. U.S., however, will report several market moving data points: Prelim GDP, CB Consumer Confidence and (Core Durable) Goods Orders. Technically, the pair seems to be slowing while moving up towards cycle-high set in September. Although that may warn of a near term correction, quick fake break above the high is not excluded.

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al_dcdemo 26 Nov.

UPDATE 6: Loonie surged through 1.34 on Monday and traded up to 1.3435. High for the year, set in late September at 1.3457, held. The oil rebounded on Friday and has not posted a losing day since. If the commodity stays supported, the pair is unlikely to break to new highs. In that case, a retest of 50 and 100 DMA (1.3150 - 1.3200) seems the most likely scenario. Otherwise, 1.34 level will need to be convincingly broken to make a push through the cycle-high feasible.

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al_dcdemo 27 Nov.

UPDATE 7: Canadian dollar lost about a quarter of a cent against the U.S. dollar and closed in the middle of the range. The pair's range was somewhat larger this week than in the previous one but overall price action was pretty much the same. Needless to say, the pair tracked oil prices which rose in the first three days of the week only to then give back most of the gains in the last two days.

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al_dcdemo 29 Nov.

UPDATE 8: Week ahead is big for Canadian currency too. GDP release will be followed by BOC meeting and labour market report. On top of that, U.S. will publish ISM Manufacturing PMI, ISM Non-Manufacturing PMI and NFP report. Attempt to break to new eleven-year highs early in the past week failed and the pair pulled back but based ahead of 1.3275. Higher lows during the best part of the month highlight the bullish bias.

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USD/JPY may well continue sideways

al_dcdemo Posted 31 Oct. as Analysis on USD/JPY, Target: 119.7500, Date: 1st of December, 12:00 GMT  in #Technical analysis #USD/JPY #Correction #Uptrend #Spike #Stimulus Program #Resistance Cluster #Neutral Technicals #Sell Off #Faltering Recovery
Monthly chart
The pair broke above a strong cluster of resistance (trendline that contained long-term downtrend in years 1986, 1990, 1998; 23.6% retracement of the 1982 to 2011 decline; 2007 high at 124.14). After weak pullback in June, the pair retested the cycle-high (~125.85) in August before it sold off strongly amid concerns about global growth, China slowdown, oil prices and Fed tightening.
Weekly chart
In the last week of August the pair broke back below the monthly resistance cluster an…
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al_dcdemo 22 Nov.

UPDATE 4: In this mostly sideways week for the pair, yen lost half a cent against the dollar. Weekly range was about a cent and a half wide. The pair gapped down on Monday, but the gap was closed in a matter of hours and the pair rose to 123.25 by the end of that day. Thursday saw a bit of a correction which didn't manage to break below 122.50.

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al_dcdemo 23 Nov.

UPDATE 5: In the week ahead Japan will report inflation data plus few other economic indicators. U.S. will publish several important data points: Prelim GDP, CB Consumer Confidence and (Core Durable) Goods Orders. Both countries will observe Thanksgiving holiday. Technically, the pair still looks bullish but recent failure to continue much past September 9th high warns that a near term correction may be in the making.

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al_dcdemo 25 Nov.

UPDATE 6: The Yen is currently trading in the lower half of one of the smallest weekly ranges of this year. There were some geopolitical tensions yesterday but it wasn't enough to make any significant dent in risk trades, which soon rebounded. 122 is key to hold but below it we have possibly even more important 121.50 level where 50, 100 and 200 DMA may converge in the days ahead. On the upside the first stronger resistance is expected at 123.75 - 124.00 and then around 125.

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al_dcdemo 27 Nov.

UPDATE 7: In another sideways week, the pair has barely managed to produce a 100 pip range. It closed the week essentially unchanged. After a quick surge at the opening, the pair started to fall and touched as low as 122.25 on Wednesday morning. Thursday's range was one of the tightest in months as it measured only 25 pips. A new range appears to be 122 - 124.

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al_dcdemo 29 Nov.

UPDATE 8: Japan will release several lower-tier indicators next week but nothing market moving. U.S. macroeconomic data released in the week ahead includes: ISM Manufacturing PMI, ISM Non-Manufacturing PMI and NFP report, plus a testimony from Fed's Yellen. Unless the data or the ECB or any external shock makes it move, the pair will likely stay in its recent (122 - 124) range until Friday (NFP).

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USD/JPY to remain in balance

al_dcdemo Posted 30 Sep. as Analysis on USD/JPY, Target: 120.2500, Date: 2nd of November, 12:00 GMT  in #Technical analysis #USD/JPY #Correction #Uptrend #Strong Support #Spike #Stimulus Program #Resistance Cluster #Sell Off #Faltering Recovery
Monthly chart:
The pair broke above strong cluster of resistance (trendline that contained long-term downtrend in years 1986, 1990, 1998; 23.6% retracement of the 1982 to 2011 decline; 2007 high at 124.14). After weak pullback in June, the pair retested the cycle-high (~125.85) in August before it sold off strongly with concerns about global growth, China slowdown, oil prices and Fed tightening.
Weekly chart:
In the last week of August the pair broke back below the monthly resistance cluster and…
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al_dcdemo 17 Oct.

UPDATE 6: After it broke the symmetrical triangle pattern, the pair fell towards 118 and nearly touched the big figure. It was essentially a fake break below 118.25 - 118.75 support zone which was followed by a sharp reversal. The pair hit the above-mentioned pattern bottom on Friday, which behaved as expected. Next week will tell whether there's any downside left or the pair will return back to previous range with the mid point near 120.

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al_dcdemo 20 Oct.

UPDATE 7: The bottom of the symmetric triangle pattern, that was broken last week, has been acting as a tough resistance in the last three trading days. The pair is creeping below it but shows no intentions of turning back down. 50 DMA has crossed below 200 DMA on Friday after it has been below 100 DMA for nearly a month. Last week's breakdown roughly coincided with the cross but the pair wasn't able to produce a significant decline.

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al_dcdemo 23 Oct.

UPDATE 8: The symmetric triangle was resolved in the most "market" way. Several fake breakouts to either side were followed by a "real" break to the downside, which proved to be fake. The pair seems to have convincingly broken above 120 level helped by risk-on sentiment spurred by ECB's dovishness and PBOC rate cuts. Stock are rallying and 125 is back in focus. 122.00 - 122.50 is the first strong barrier on the way there.

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al_dcdemo 27 Oct.

UPDATE 9: Yen rose more than two cents last week. It traded up to 121.50 and closed above 200 DMA. However, it has been falling since the beginning of this week, to as low as 120.15 in today's trading, before stalling. The big figure (120), also the mid point of the 118 - 122 range, shall hold if the pair wants to maintain bullish bias. On a break below, retest of the lower extreme of the range will come back into focus.

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foreignexchange 2 Nov.

Great analysis : )

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Loonie grinds higher

al_dcdemo Updated 29 Sep.  in #Trader's blog #Support #Resistance #USD/CAD #Uptrend #Hawkish Fed #H1 Chart #Weak Commodities #Risk Off Sentiment
Uptrend in Loonie is slow but persistent. The pair has posted (yet another) new eleven-year high today, breaking above last Thursday's high by 15 pips before pulling back. The drivers remain weak commodities and general risk-off sentiment. Hawkish comments from Fed speakers yesterday didn't help it either.
First stronger intraday support is seen at 1.3385 - 1.3400 (00's, Previous Day High, Low Of Day) and then between 1.3335 and 1.3365 (Daily Pivot Point, 50's, 1.3345 pivot, Daily Resistance 1).…
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foreignexchange 1 Oct.

Bullish Loonie ; )

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USD/CAD to climb some more

al_dcdemo Posted 26 Sep. as Analysis on USD/CAD, Target: 1.3425, Date: 2nd of November, 12:00 GMT  in #Technical analysis #Oil #USD/CAD #Breakout #Uptrend #Rate Cut #Strong Demand #Eleven Year Highs #Weak Fundamentals #Second Wave
Monthly chart:
The pair is in uptrend since 2011. It broke above 38.2% retracement (of the 2002 to 2007 decline) in January and then traded around 50.0% retracement for nearly three months. In April, the pair pulled back deep enough to clear stops below 1.20. The confluence of the broken trendline (drawn off 2003, 2004 and 2009 highs) and 38.2% retracement wasn't even properly retested before the pair resumed its uptrend. It is currently trading at eleven-year highs.
Weekly chart:
After Q1 range…
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al_dcdemo 27 Sep.

UPDATE 1: Apart from GDP, there's little coming out from Canada in the week ahead. Events from the US will again be in focus: Fed speakers, CB Consumer Confidence, ISM Manufacturing PMI and NFP figures. There's resistance zone between July 2004 high (1.3385) and 1.35 which includes 61.8% retracement of the 2002 to 2007 decline (1.3470). 50 DMA has held the pair since June and is the first stronger level on the downside.

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al_dcdemo 29 Sep.

UPDATE 2: Uptrend in Loonie is slow but persistent. The pair has posted (yet another) new eleven-year high today, breaking above last Thursday's high by 15 pips before pulling back. The drivers remain weak commodities and general risk-off sentiment. Hawkish comments from Fed speakers yesterday didn't help it either. First stronger intraday support is seen at 1.3385 - 1.3400 and then between 1.3335 and 1.3365. There's quite a few resistance levels stacked up ahead of the big 61.8% retracement.

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al_dcdemo 2 Oct.

UPDATE 3: This is shaping to be the best week for the Canadian dollar since June. After posting new eleven-year high on Tuesday, the pair turned sharply lower on Wednesday. Follow through selling on Thursday was cemented on Friday, after the release of US NFP report for September which was a big disappointment. The pair's shorter-term correlation with oil faded a bit but it's the longer-term one that really counts.

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al_dcdemo 9 Oct.

UPDATE 4: Commodities rallied this week with the oil (WTI) gaining about $4, which is even more significant (8%) in percentage terms. Loonie has convincingly broken below three big support levels: 50 DMA (currently ~1.32), 2008 high (1.3064) and 1.30 big figure level. 100 DMA is the next one ahead of Q1 highs between 1.2800 and 1.2835. Momentum is strong and may easily carry it another couple of cents lower.

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