USD/CAD: Fade on Major Gains in USD - Scotiabank
Analysts at Scotiabank explained that USD/CAD’s test of 1.25 on Friday
is marked on the daily chart by a minor “doji” candle—ordinarily a
warning that a move is prone to a correction.
The recent trend decline in USD/CAD is littered with other, minor warning signals that have failed to herald any meaningful bounce, however, and we are loathe to call an end to the drop in funds at this point.
USD/CAD is entering its sixth successive week of declines but short, medium and longer-term trend strength signals remain bearishly aligned, suggesting the move lower retains very strong, underlying momentum where rebounds will be severely limited.
We continue to see minor gains in the USD as a selling opportunity. We see resistance at 1.2580/00 over the next 24 hours, stronger resistance at 1.2750. We think a reversal through 1.30 is needed to boost the USD significantly."