Talking Points
AUDCAD reversal in focus
Weekly OR break keeps topside bias in play
Key Event Risk on Tap
ADUCAD Daily
Chart Created Using FXCM Marketscope 2.0
Technical Outlook
AUDCAD breaks above weekly opening range high- bullish near-term
Resistance at 9835 / January TL & 9927/36
Support at 9700 & 9630/57- bullish invalidation
Daily RSI signature remains constructive / 50-bounce today
Event Risk Ahead: Australia Employment data & Canada New House Price Index on Thursday
AUDCAD 30min
Notes:On January 27th we noted a short-bias on AUDCAD while below 9928 with the ensuing sell-off taking the pair into the 9630/57 key support zone. The rebound closed last week just below near-term resistance at 9777/85- where this week’s opening range high was targeted. A slope line extending off the February high also converges on this region today with momentum signature holding 40-support since the start of the week- constructive.
The breach above this region this afternoon was accompanied by a trigger break in momentum, confirming our near-term topside bias eyeing targets at 9835 & the 100% extension at 9864. Note that this level converges with basic trendline resistance off the January high into the close of Asia trade tonight. Bottom line- we’ll favor buying pullbacks while above 9750 (gap) with a breach above 9864 opening up targets into 9895 & 9928. A break below the weekly opening range low invalidates the setup with such a scenario targeting key support at 9557/66. A quarter of the daily ATR yields profit targets of 31-34 pips per scalp. Caution is warranted heading into event risk out of Australia with the employment report on Thursday likely to fuel added volatility in Aussie crosses.
* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.
Relevant Data Releases
Other Setups in Play:
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—Written by Michael Boutros, Currency Strategist with DailyFX
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Source: Daily fx