Technical analysis of USD/CAD dated 10.05.2013
USD/CAD to the recent price rise, by reaching to the downtrend line specified in the picture below is disable to ascend more and by creating a top price below that started to decline and has fallen. The mentioned down trend line is one of the important resistance levels on long term price range. The sellers were successful in reaching to the lowest price of 1.00122. Price has been stopped from more descend during a downfall by reaching to the uptrend line (consisting of two bottom prices) and Fibonacci support level of 127.2 that shows exit of sellers and their use of these levels for their trades’ purposes . This price level is recorded as a bottom price by an uptrend candle and it prepares the field for the possible ascending of the price during the next days.
According to the formed movements in the chart, there is AB=CD harmonic pattern with ideal ratios of 78.6 and 127.2 between top price of 1.03392 and the bottom price of 1.00122 that warns about the potential of ascending from the endpoint of this pattern. Stoch indicator in daily time frame is in saturation sell area and also it is in divergence mode with the price chart that confirms the created bottom price on the uptrend line and warns about the potential of changing price direction. Generally according to the mentioned signs, until the bottom price of 1.00122 is preserved, the price will have the potential for increasing.