Loonie: It was 4 month rally, so let it corrects.
USDCAD retraced sharply due to:
- While major central banks increase easing, BOC refuses to do that.
- Energy price bounces from the troguh.
We see U/C rallied 4 months from 1.2810 to 1.4680 : It was 1800 pips : That is a great move, so it's not surprising if it corrects from the peak.
But how much does it retraces ?
Draw Fibonacci retracement from 1.2810 to 1.4680, then we will see U/C now stops at 38.2% fib level. It also was an old resistance now becomes support.
38.2% is a good stop of correction, but I allow it retraces to 50% level at 1.3740
However, I see U/C also tests the ascending trend line. It's a big deal if it breaks trend line to test 50% Fib retracement, because it could be a trend reverse.
I hope USDCAD stops the depreciation. Why ? Energy oil is still vulnerable, so a BUY is still a good choice.
This week, main focuses are payrolls, Canada employment report, and RBC PMI.
Let market moves.
- While major central banks increase easing, BOC refuses to do that.
- Energy price bounces from the troguh.
We see U/C rallied 4 months from 1.2810 to 1.4680 : It was 1800 pips : That is a great move, so it's not surprising if it corrects from the peak.
But how much does it retraces ?
Draw Fibonacci retracement from 1.2810 to 1.4680, then we will see U/C now stops at 38.2% fib level. It also was an old resistance now becomes support.
38.2% is a good stop of correction, but I allow it retraces to 50% level at 1.3740
However, I see U/C also tests the ascending trend line. It's a big deal if it breaks trend line to test 50% Fib retracement, because it could be a trend reverse.
I hope USDCAD stops the depreciation. Why ? Energy oil is still vulnerable, so a BUY is still a good choice.
This week, main focuses are payrolls, Canada employment report, and RBC PMI.
Let market moves.