Pullback on the USD/CAD

The US Dollar versus the Canadian Dollar has stayed in a well-supported down trend as shown on the daily chart. At the moment the price is trying to retrace or pullback to the upside, but the 1.3200 or the 21 day exponential moving average could act as resistance. In order for a trend to be sustainable, it needs to have some pullbacks on the way to allow new sellers to come into the market. That is why the pair has had a good bearish trend, because it has had its pullbacks along the way. The 1.2900 level could act as support.

Webinars: How to overcome fear in your trading

Great events and webinars provided by ActivTrades for the second half of March. Today, March 17 we have a Webinar by Paul Wallace on how to overcome fear when you are trading. Fear may prevent us from making money, but also greed can make us lose. The events are free of charge, if you would like to register please visit:

https://www.activtrades.co.uk/index.aspx?page=events_webinar

On March 24 we also have another great Webinar by Paul Wallace on tips from a great stock market operator: Jesse Livermore. Don’t miss this great opportunity to expand your knowledge and learn from some of the best traders and professionals on the field.

Rally on crude supports the Canadian Dollar

Light crude oil, WTI rallied for today above the 40.00 level and it is nearing the 41.00 level. The rally on crude has helped the Canadian Dollar, due to the fact that those two instruments have a positive correlation. On the daily chart of the USD/CAD we see a very interesting price action. The bearish trend is still in place and that can be confirmed by the slope and direction of the 21 day exponential moving average, yellow line. After the price breaks below the 200 day EMA, blue line, it retraced to that zone, but the moving average, along with the 1.3400 level acted as good resistance. The pair drops to the 1.3100 level and stalls at the moment there, but since the bearish trend is still in place, it may continue dropping towards the 1.2827 level. The 21 EMA is trying to break below the 200 EMA and if it does then it could be an indication of further drops on the USD/CAD. In case the price goes back up for any reason, then the 1.3400 zone could act once again as resistance.

Is the EUR/JPY heading back down?

On the daily chart of the EUR/JPY we can see that the pair is really in a downtrend in the medium term, due to the downward slope that the 200 day exponential moving average has, blue line. The price has been retracing to the upside lately, but during the last few daily candles we can see the bearish momentum accelerating. On the last leg down from the high at the 132.29 level to the low at the 122.07, the price retraces a 50% Fibo. If the pair breaks the two red trendlines to the downside, then it may go back to its longer term bearish trend.

A break down may take the price to the low at the 122.07 level, which could act as support. To the upside, if the price breaks above the 50%, then the 61.8% Fibo, around the 128.38 may act as resistance. But the most important Fibo level which usually works as support or resistance is the 76.4%. Therefore, we must pay attention to a visit of the EUR/JPY to the 129.85 zone, which is where the 76.4% Fibo is sitting at.

Head and Shoulders on the DAX?

The head and shoulders pattern can sometimes appear upside down or inverted. On the daily chart of the German DAX, we can see that the index has formed what it appears to be an inverted head and shoulders pattern. The 9897 zone could be used as the neckline or confirmation line for the pattern, which it has broken to the upside today. The stock markets have been rallying since the European Central Bank raised its economic stimulus. That is why we see that the DAX has rallied for today. If the index continues going higher, then the 200 day exponential moving average, around the 10247 could act as resistance.

If the head and shoulders pattern fails and the index goes back below the 9897, then the DAX could fall towards the 9300 level. But the current pattern could be the beginning of a trend change to the upside on the long term. Let’s see if the index continues making higher highs and higher lows.

The USD/CAD without a clear direction

The trend on the USD/CAD is bearish on the daily chart and it is possible for the pair to continue falling further, but in the short term there is no clear direction and the price continues boxed in between the 1.3200 and the 1.3300 level. To the upside, the 1.3400 or the 200 day exponential moving average may act as resistance. If the 21 day EMA, yellow line, crosses below the 200 day EMA, then the pair may continue dropping, but it may find some support around the 1.3100 level or the 1.3000. But in order for the bearish trend to stay in place, oil must continue rallying.

The FTSE100 is boxed between two EMAs

On the daily chart of the FTSE100 of the United Kingdom we can see that the index stays right in between the 55 day exponential moving average, purple line, and the 200 day exponential moving average, blue line. There was a lot of volatility for today in the markets due to the decisions taken by the European Central Bank, however the markets in the United Kingdom have been hurt by the uncertainty surrounding the possible exit of the UK from the European Union.

That uncertainty has created high volatility and that is why we can see on the daily chart that the latest candle is relatively big. It seems like the bearish momentum is still in place and a breakdown below the 5990 could take the index to the 5813. If the FTSE goes back up, staying inside the EMAs, then it could try to break above the 200 EMA and maybe reach the 6448.