Participant

CAD has been weakening for 4 years with recent price action that has reached highs not seen since 2008. But the markets as often happens, take into account the facts and over react to what they are factoring in. CAD may have weakened more than necessary and if on Wednesday there is no hint to interest rate hikes coming very soon, meaning September, rather than later on in the year, then this pair could see a major correction. Looking at the day chart we can see a major price reversal pattern from over the previous 3 trading sessions. Three hanging men with the middle one slightly higher than the other surrounding two looks very bearish. Today’s price action confirms that pattern with a long red candle. ADX and Stochastic Oscillator are both in overbought territory. First support is on the Fibo expansion 100% line at 1.27631 if that breaks the next support is at the 61.8% line at 1.25223.

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