The Canadian dollar is on a roll, making a huge recovery. What’s next for USD/CAD?
The team at SocGen examines the pair around the all important 1.20 level.
Here is their view, courtesy of eFXnews:
After an accelerated uptrend, USD/CAD found stiff resistance near 1.2850, and appears to be undergoing an intermediate correction, notes SocGen.
“Monthly indicator earlier retraced from a graphical resistance and now is approaching a multiyear trend line support. On Daily charts, the pair earlier confirmed a Head and Shoulder pattern and is approaching towards the projected target of 1.20, which also happens to be the monthly channel limit and the 23.6% retracement from 2011 lows,†SocGen adds.
“With daily Stochastic closing in on a support 1.20 will be a key level and a rebound is not ruled out once these levels are achieved. It will take a move past the short term channel limit at 1.22/1.2220 to signal a recovery towards the Head and Shoulder’s neckline,†SocGen argues.
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