By FXEmpire.com
The USD/CAD pair fell for the week, to test the 1.02 support level in the end. The oil markets had a massive day on Friday, and in turn so did the Canadian dollar. In fact the light sweet crude market gained roughly 9%, something completely unheard of. This of course was bullish for the Canadian dollar, but we did manage to find support at the 1.02 area, and this does have is asking some questions.
With the European Union announcing the support for bond purchases and Italy and Spain, this gave the market a bit of a relief rally. We don’t know whether or not this is the “real deal”, or just another head fake out of Europe. Because of this, we would with some trepidation sell this market on a break below the previous week’s bottom of the range. This sets us up for a move down to parity, a place that we think we will see support again. As for going long it’s going to be very difficult at this point without some type of supportive candle. Of course, a break of the 104 level would be reason enough as it is the most recent resistance level.
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Originally posted here
