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Australian and Canadian Dollars Neutralize Bear Trends vs the US Dollar

Technical Analysis

Strong rallies by the AUD and CAD versus the USD since the end of January and through early February have neutralized the proceeding bearish trends for these currencies. However, this does NOT necessarily signal the start of renewed bullish pressures for AUDUSD and bearish pressures for USDCAD, but rather shifts to broader range environments.

Latest technical analysis

AUDUSD

The push above .7225 sees a broader ranger environment for February.

Short/ Intermediate-term Range Parameters: We see the range defined by .6914 and .7327.

Range Breakout Challenge

  • Upside: Above .7327 aims higher for .7385, .7440 and .7499.
  • Downside: Below .6914 sees risk lower for .6825 and .6645.

Halted in the upswing Thursday by the trend line from December, currently .7240, and an unexpected plunge through supports Friday (7160/50 and .7075/70) shifts to a bear bias for Monday within the broader range.

For Monday (8th February):

  • We see a downside bias for .7000; break here aims for .6963.
  • But above .7093 opens risk up to .7139.

Daily AUDUSD Chart

AUDUSD

USDCAD

The early February push through the 1.3799 chart support from December 2015 and the trend line from October 2015, produced a switch to a broader range theme into February.

Short/ Intermediate-term Range Parameters: We see the range defined by 1.4326 and 1.3360.

Range Breakout Challenge

  • Upside: Above 1.4326 aims higher for 1.4690, 1.4941/58 and 1.5000.
  • Downside: Below 1.3360 sees risk lower for 1.3000 and 1.2828.

A resilient intraday turnaround on Thursday, primarily a reaction to bearish fatigue and then a positive follow through on Friday (above 1.3797 and 1.3849) through the US and Canadian Employment reports, has now seen a shift  to a positive tone within the range theme for Monday.

For Monday (8th February):

  • We see an upside bias for 1.3929; break here aims for 1.4030, maybe 1.4103/09/19.
  • But below 1.3805/00 opens risk down to 1.3720.

Daily USDCAD Chart

USDCAD

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