Intraday Market Analysis – CAD Struggles For Support

Intraday Market Analysis – CAD Struggles For Support

USDCAD grinds higher

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The Canadian dollar weakened after the BOC left the current QE unchanged.

Following the pair’s bounce off the daily support at 1.2500, the break above the congestion area near 1.2640 suggests strong commitment from the buy-side.

Lifting offers at 1.2705 may have opened the door to the recent peak at 1.2950. However, the RSI’s overbought situation may temper the bullish fever in the meantime.

The former resistance at 1.2620 has turned into support to test buyers’ resolve.

NAS 100 breaks support

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The Nasdaq 100 slumps as investors worry about moderating growth. The index is holding onto recent gains in the hope of reaching the next all-time high at 15800.

On the daily chart, the price’s divergence with moving averages combined with an overbought RSI could trigger mean reversion trades. The hourly chart is also painting an overextension.

The RSI’s bearish divergence indicates a loss in upward momentum.

A fall below 15520 would prompt traders to take profit. 15300 is key support on the 30-day moving average.

GBPJPY tests support

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The sterling underperformed after the British government announced its plan to raise taxes.

The pair has broken below the rising trendline from the support at 149.20. This is an indication that the recovery momentum has slowed down.

An oversold RSI may attract buying interest at 151.30. Then a rebound will need to clear 152.50 to keep the bullish bias intact.

Failing that a fall below would trigger a sell-off as short-term buyers scramble for the exit. Further down, 150.50 would be the next target.

John Benjamin Macro-Analyst at Orbex

John Benjamin is a Macro-Analyst at Orbex. John has over 8 years of experience specializing in the currency markets, tracking the macroeconomic and geopolitical developments shaping the financial markets. John applies a mix of fundamental and technical analysis and has a special interest in inter-market analysis and global politics.