USDCAD: The pair is weakening for a second day in a row following a reversal of its Friday gains on Monday. This development now leaves the risk of a return to the 1.0074 level, its Jan 03’2012 low. A violation of here will set the stage for more declines towards its nearby support at the 1.0051 level, its Dec 08’2011 low where a clearance will target its Nov 01’2011 low at 0.9970. A breather could occur here and turn USDCAD higher but if that level snaps, further declines could build up towards the 0.9890 level, its Oct 27’2011 high. Its daily RSI is bearish and pointing lower suggesting further weakness. On the upside, USDCAD will have to return above the 1.0317 level and the 1.0423 level, its Dec 14’2011 high to halt its present weakness and then resume its strength towards its Nov 25’2011 high at 1.0524. Further out, its Oct’2011 high at 1.0665 will serve as the next upside target followed by its May 2011 high at 1.0852. All in all, the pair continues to remain vulnerable on bear pressure.
