Technical Analysis USDCAD : 2014-03-20

Good afternoon, dear traders. Today at 13:30 (CET) the new release of Primary Jobless Claims in the U.S. will be published (Unemployment Claims). This indicator reflects the statistics for the previous week from the Ministry of Labor. The decrease of jobless rate stimulates domestic demand on products and increases the attractiveness of the U.S. economy for investors. In this regard, if the actual value is below the projected level (327K), then we should expect strengthening of the U.S.currency.

Today we consider the USD/CAD on the H4 chart. There was a resistance line upward breakthrough on the H4, indicating the appearance of an additional upside Canadian momentum. However, we believe that it is necessary to wait for confirmation from the RSI-Bars (14); at the moment the last bar crossed the line support down and it is an alarming signal. We should ensure that it is a false breakdown if we choose the role of "bull" for a given currency pair. On the other hand the price crossed the signal line Pivot and the first resistance of this indicator which is rare and certainly confirms the upward trend. There is also no contradiction on the part of the trend indicator ParabolicSAR.

We choose a target based on traditional strategy; fix next historical maximum below 161.8% Fibonacci level. At the moment it corresponds to around 1.13205. The stop loss is recommended to be placed at the nearest support - 1.11503 and moved towards indicator ParabolicSAR, as soon as it crosses the preliminary stop level. The order should be opened 15 minutes before the Unemployment Claims publication. We believe that the position should be closed if the value of the macroeconomic indicator is below the projected level. This would mean that the trend has reversed and the market, undergoing fundamental changes, have not been taken into account.

Position openingabove 101.952
Targetbelow 102.165
Preliminary stopbelow 101.537

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