USD/CAD Technical Analysis October 17, 2011

The USD/CAD continued to fall during the Friday session, and now looks set to retest the parity level. The level is massive support, and far too close for comfort to sell at this level, so unless you are already short – it isn’t advised to be so at this point.

The parity level should offer support, and could produce a long position if we get the correct supportive candle. If we can close below the parity level – this pair continues the long down slide that we have seen over the last several years. The pair is in a downtrend, so this wouldn’t be a massive surprise. However, with headline risks out there, it wouldn’t be a stretch to see this pair raise again either. This pair should continue to be very volatile in the near-term, so tight stops are recommended.