NZD/CAD surged on Friday, breaking above the key resistance (now turned into support) territory of 0.8625, as well as above the downside line taken from the peak of September 20th. This, combined with the fact that the rate is printing higher highs and higher lows above an upside line taken from the low of February 1st, paints a positive near-term picture.
The rate also climbed above the peak of January 5th, at 0.8690, a move which may have opened the path towards the 0.8765 territory, marked by the highs of December 22nd and 30th, as well as by the inside swing low of November 16th. If the bulls are not willing to stop there, then we could see the pushing towards the 0.8800 or 0.8835 zones, where another break could carry larger bullish implications, perhaps setting the stage for advances towards the 0.8910 zone, marked by the peak of October 27th.
Taking a look at our daily oscillators, we see that the RSI runs slightly below 70 and points up, while the MACD lies above both its zero and trigger lines, pointing up as well. Both indicators detect strong upside speed and support the notion for further advances in this exchange rate.
Now, in order to start examining whether the bears have taken back their swords, we would like to see a clear dip below the 0.8520 zone, marked by the low of February 27th. Such a move could confirm the rate’s return back below the aforementioned downside line taken from the high of September 20th, while it could confirm the break below the upside line drawn from the low of February 1st. We could then see declines towards the 0.8410 zone, marked by the low of February 16th, the break of which could set the stage for extensions towards the low of January 28th, at around 0.8345.
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