Will the USDCAD keep rising?

The USDCAD has been rallying steadily from the 200 day EMA around the 1.2771 level. The rally on the pair has been caused mainly by strength in the US Dollar, but the drop in oil has also contributed to the weakness on the Canadian Dollar. If it continues rallying, the USDCAD may find some resistance at the peak of the 1.3123 level. To the downside, the 1.2913 level may act as support, due to the fact that the level was acting as resistance when the price was boxed between that level and the 200 day EMA as support. Below the 200 day EMA, the most relevant support in the mid-term is the low at the 1.2526 level. For now oil is still weak and since it has a positive correlation with the Looney, it may cause the USDCAD to keep rallying.

WTI oil finds support

Oil has been dropping or correcting to the downside after Russia and Saudi Arabia announced that they will raise their oil production to take advantage of the recent rally in crude prices. The news has caused the price of WTI oil to break below the 70.00 and reaches the 55 day EMA around the 67.49 level. After breaking below the 55 day EMA, the price of WTI oil drops to the 66.00 zone. Right now the price is consolidated or boxed between the 66.00 and the 67.49 from where it may head in any direction. To the upside, the 70.00 level could act as resistance, followed by the 72.00 from where it started to retrace. To the downside, below the 66.00 level, the price of WTI oil would have the road practically clear to drop to the 61.71 level and the 200 day EMA (blue line) could also act as support.

The Euro has no bottom

The Euro versus the Dollar seems to have no bottom and the pair continues falling as shown on the daily chart. The EUR/USD falls below the 1.1700 levels and reaches the 1.1650 zone. The pair may continue falling, but the 1.1600 level could act as a support. However, the pair may even break below the 1.1600 level due to the fact that the 55 day EMA is pointing down and it could cross below the 200 day EMA. In case of a cross of the 55 day EMA and the 200 day EMA, we would see a death cross, which has bearish implications in the mid-term. To the upside, the round number levels could act as resistance, but the most relevant resistance is at the 1.2000 level where we can find the 200 day EMA and where the price already created a breakout and pullback pattern.

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Is there a possible resistance on gold?

The light pullback that we are seeing on the Dollar lately has favored the price of gold due to the negative correlation that there is between those two trading instruments. Gold was in a channel since the beginning of the year, stuck between the 1300 zone as support and the 1365 as resistance. Even though the range is relatively wide, the price respected those levels pretty good until it broke to the downside. Las week the price of gold manages to break below the 200 day EMA (blue line) and the 1300 level to reach a low at the 1281 level. From the 1281 level the price consolidates and goes back to the 1300 zone. The 1300 level may now act as resistance, since it was support in the past. The 200 day EMA may also act as resistance. In case of a bearish breakdown below the 1281 level, the 1273 level may act as a good support, due to the fact that exactly at that level we can find the 200 week EMA. Above the 200 day EMA, the price of gold would enter a congestion area where it may consolidate again.

Consolidation continues on gold

Since the beginning of this year, the price of gold had been in a range between the 1300 and the 1365. However, a week ago the price broke below the 200 day EMA blue line and the 1300 level. The price then drops to the 1281 level where it consolidates during the last few days. Now, the 1300 level may act as resistance along with the 200 day EMA. On the other hand, the 55 day EMA, purple line, is pointing to the downside, indicating that the price may continue lower or that a bearish trend is initiating. The price is really consolidating, but if it breaks below the 1281 level, then the 1273 level may act as a better support, due to the fact that in that level is where we find the 200 week EMA. Going further down, the low at the 1236 is its most relevant support in the mid-term.

Possible hammer on the EUR/USD

The EUR/USD has kept a good bearish trend, pressured by the rally on the US Dollar. The Greenback accelerates its bullish momentum after the trade tensions between the US and China ease and supports the rally on the Dollar. On the daily chart of the EUR/USD we can see that the pair has dropped below the 1.1800 level and came very close to the 1.1700 level. The 55 day EMA (purple line) is pointing down and it may try to cross below the 200 day EMA (blue line), which could complete a death cross. The death cross pattern has bearish implications in the mid-term. Therefore, even though the price of the EUR/USD may pullback in the short-term, it may continue dropping. Today´s daily candle is the shape of a hammer, which is a bullish reversal candlestick pattern. If the next candle is bullish, then the EUR/USD may try to correct towards the 1.1900 level which could act as resistance.