Daily Insight: Bullish Momentum Favored In NZD/CAD
Matt Simpson | Oct 20, 2014 03:02AM ET
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No 'red' news today so I expect price action to trade within ranges with potential for whipsaws between key levels. The markets are waiting to Central Bank speeches and minutes to be released to may be better to trade intraday timeframes and not outstay your welcome.
TECHNICAL ANALYSIS:
USDCAD: Seeking bullish setups above 1.12
With a lack of news tonight the risk is for choppy trading across the board. USDCAD is meandering around the weekly pivot and coiling up within a potential bullish wedge pattern.
Technically I suspect we'll get a move towards 1.12 support where we could then seek bullish setups in hope of the bullish wedge. However for this to materialise we do require a USD bullish catalyst, so be prepared for limited moves and to remain within ranges.
We are currently trading near the annual highs so we may find any bullish moves quite limited as we lead up to US inflation data later this week.
NZDCAD: Intraday targets 90c
The original analysis called for 0.8860 to hold as resistance for a swing trade short. It was not to be. Instead we saw an upside break of this level which confirmed an Ascending Triangle, projecting an approximate bullish target around 0.90.
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Intraday timeframes favour the bullish momentum and provides higher highs and lows. We have also seen a spike low at 0.8872 to suggest a swing low, which was then accompanied by higher volume on low-range candles to suggest another swing low has formed.
Therefore the idea is to seek bullish setups above these swing lows to target 0.90.
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