CANADIAN DOLLAR
This currency has a special place for me. During my post-graduate studies in Canada, I used to follow it closely as I was converting U.S. dollars to Canadian dollars almost every month. When I decided to move to Canada in 2003 crossrate was at 1.4 levels. 1 USD used to buy 1.4 CAD. It has constantly moved lower over the past decade and at one point it reached 0.90 levels.
Today I’m analyzing Canadian dollar and giving Tech Charts visitors a “heads up” on the possibility of a strong breakout in the following days. Canadian dollar formed several consolidation ranges in the past year. In Aug-Sep period a sideways consolidation, in Oct-Dec period a contracting range (symmetrical triangle) and now over the past one month another sideways consolidation. Each breakout from these consolidation ranges was strong and was followed by a directional move. Canadian dollar has been trading in a range between 1.009 and 0.995. Price found support above the 200 day moving average, a bullish development. We are likely to see a breakout soon. Please note that volatility reached an extreme low reading and a breakout could result in a strong move. A break above 1.009 level will be very positive for Canadian dollar. A break below 0.995 will be negative. My suggestion is to wait for a confirmation and take action when one of these levels are breached.
