NZDCAD Technical Analysis


The weakness against Canadian dollar continued today as seen in the 7 December NZDCAD Technical Analysis. The New Zealand dollar also managed to gain a quarter of the losses seen today, by moving above the 50-period MA.

7 December, HotForex – USDCAD has lifted for three consecutive days now, achieving a high of 1.2834 today, reversing most of the sharp losses that were seen last Friday following above-forecast GDP and employment data out of Canada.

The BoC’s cautious guidance following its policy meeting yesterday, when it left its policy rate at 1.0%, as had been widely anticipated, has been weighing on the Canadian buck. In particular, the BoC noted that slack remains in the labour market, despite recent rises in overall employment.

7 December NZDCAD Technical Analysis

The weakness against Canadian dollar continued today, for all major Canadian dollars such as EUR, GBP, USD except AUDCAD, NZDCAD and CADJPY.   Both the yen and the Australian dollar came under pressure today, the former as its safe haven premium unwound some amid a steadying in global stock markets, which were aided upward by a rebound in tech stocks, while the latter was pressured on data showing a sharp drop in Australia’s trade surplus.

Despite the mixed performance of CAD, the northwards movement today of USDCAD, in the upper Bollinger Bands pattern and above 1.2800 triggered an intra-day position for us, especially after the break of the Upper Fractal in the 4-hour chart at 1.2814. 

The pair has formed a confirmed bullish Hammer in the Daily chart, after failing to break below the lower Bollinger Bands line, which seems to provide a support for the pair at 1.2600. The Daily Momentum indicator, confirm that pair started gaining upwards momentum, with RSI breaking above the 50 level yesterday and  MACD being positive since October. The Stochastic is below neutral but presents a sharp slope upwards on yesterday’s performance.

Intra-day, the RSI is at 64 looking that there is still space for upwards momentum, while MACD turned positive, however, MACD line has not still crossed above neutral. In the 4-hour chart, the pair is moving above all 3 MAs, with Bollinger Bands extending its upper line. Hence two targets were set at next resistance, at 1.2850 and on the Daily Bollinger Band line at 1.2880. Support comes at the confluence of 50-period MA in the 4-hour chart and the 20-Daily MA, at 1.2770.

Another interesting entry could be triggered within the day, in NZDCAD. The NZDCAD drifted by nearly 50-pips this morning, however, manage to hold above 20-Day MA during London open and above the 38.2 Fibonacci level seen since November 29.

In the 1-hour chart, the New Zealand dollar managed to gain a quarter of the losses seen today, by moving above the 50-period MA, while significant could be the fact that 20-period MA crossed above the 200-period MA, suggesting some upwards momentum. However with Momentum indicators, being neutral or still Negative, only a break above the 20-period MA in the 1-hour chart could trigger a short-term Long position for NZDCAD. If this break occurs,  targets could be set at 0.8797 and 0.8824. Intra-day support is within 0.8750-0.8755.

However in the alternative scenario, a break below the confluence of 50, 200-period MA and 38.2 Fib level in the 1-hour chart, then a short position will be triggered with Targets at 0.8735 and 0.8720 and support at 0.8791.

Disclaimer

This article about 7 December NZDCAD Technical Analysis was written by Andria Pichidi, Market Analyst at HotForex. The provided article is a general marketing communication for information purposes only. It does not constitute an independent investment research. Nothing in this communication contains an investment advice or an investment recommendation. It also does not contain a solicitation for the purpose of buying or selling of any financial instrument.

All information provided gathered from reputable sources. Any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. We assume no liability for any loss arising from any investment made based on the information provided in this communication.

 

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