CAD: Positivity needs confirmation 14/2/2024

The Canadian dollar has defied expectations of a downward trend, particularly as trading stabilized above the key resistance level of 1.3520. Previously, we anticipated a halt in the downward trajectory if stability above 1.3520 was achieved, signaling a potential upward movement towards 1.3550 and 1.3590.

Today, from a technical standpoint, we lean towards positivity, drawing confidence from the pair’s breach of the 1.3520 resistance level. Additionally, the simple moving averages have shifted to support the price from below, accompanied by clear signals on the 14-day momentum indicator.

With daily trading sustaining above 1.3520, the upward trend appears most probable, particularly upon breaching 1.3620. This breakthrough would serve as a catalyst, bolstering momentum towards anticipated targets at 1.3675 and 1.3740.

However, failure to maintain hourly candle closure above 1.3520 may delay the upward momentum, potentially leading to a retest of 1.3470 before resuming upward attempts.

Warnings:

1. The Stochastic indicator shows signs of shedding its current negativity, hinting at potential shifts in market sentiment.
2. Today’s market activity may experience heightened volatility due to the release of high-impact economic data from the British economy, including the annual consumer price index and the Governor of the Bank of England’s speech.
3. Traders should exercise caution given the elevated risk level stemming from ongoing geopolitical tensions, which could contribute to increased price volatility.

Note: Trading on CFDs involves risks. Therefore, all scenarios may be possible. This article is not a recommendation to buy or sell but rather an explanatory reading of the price movement on the chart.

S1: 1.3470	R1: 1.3620
S2: 1.3385	R2: 1.3675
S3: 1.3325	R3: 1.3760