USD/CAD surged higher on Tuesday, in line with the tactical bullish view of the Credit Suisse analyst team. A move above 1.2495/2514 is now needed to increase the risk of a broader base.
Increasing risk of major potential basing structure
“USD/CAD surged higher on Tuesday, breaking above minor resistance at 1.2451 to increase the risk of a larger basing structure. So far, the pair is once again stalling at key resistance at 1.2487/2514, which also capped the market back in June.”
“With daily MACD staying outright bullish and the market maintaining its break above the 55-day average though, we look for a break above here to open up a move to the major cluster of resistances at 1.2639/56, which includes the 200-day average, a long term retracement level and a cluster of price highs. It’s worth highlighting that a break above here would complete a major base to turn the broader risks higher.”
“First support stays at 1.2322/02. More importantly, we look for 1.2252/23 to hold to keep the 1-month risks higher. A quick close below here would suggest the market is moving into a choppy broad range, with next resistance at 1.2160/45.”