GBP/CAD traded sharply higher today, breaking above the downside resistance line drawn from the peak of March 10th. However, that rate still stays within the consolidative zone that has been containing most of the price action since March 18th. That area is between the 1.6610 and 1.7020 barriers. Although there are decent chances for some further advances, we would stay neutral for now and we would start looking north as soon as the upper bound of that consolidative zone gets broken.
Such a break may wake up more bulls, who could decide to climb towards the high of March 18th, at around 1.7255. They may decide to take a break after reaching that zone, thereby allowing a small retreat. However, as long as such a retreat stays limited above the 1.7020 hurdle, we would expect buyers to recharge and shoot again. This time, they may breach the 1.7255 level and perhaps put the 1.7430 obstacle on their radars. That barrier is marked as a resistance by a small intraday swing high formed on March 13th.
Taking a look at our short-term oscillators, we see that the RSI has just poked its nose above 50, while the MACD, already above its trigger line, looks to be heading towards zero. It could gain a positive sign soon. These indicators suggest that the pair may soon start picking the necessary upside momentum for overcoming the 1.7020 barrier.
On the downside, a dip back below 1.6915 may signal that traders want to keep this exchange rate range-bound for a while more. Initially, we could see a slide towards the 1.6730 level, marked by today’s low, the break of which may encourage some sellers to challenge yesterday’s low, at 1.6610, which is also the lower end of the pre-mentioned trendless zone.
Disclaimer:
The content we produce does not constitute investment advice or investment recommendation (should not be considered as such) and does not in any way constitute an invitation to acquire any financial instrument or product. The Group of Companies of JFD, its affiliates, agents, directors, officers or employees are not liable for any damages that may be caused by individual comments or statements by JFD analysts and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his investment decisions. Accordingly, you should seek, if you consider appropriate, relevant independent professional advice on the investment considered. The analyses and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with the legal requirements for financial analyses and must therefore be viewed by the reader as marketing information. JFD prohibits the duplication or publication without explicit approval.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with the Company. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Please read the full Risk Disclosure.
Copyright 2020 JFD Group Ltd.