Possible bearish continuation on the USD/CAD

After a consolidation, the price of an instrument has a higher probability of continuing in the direction of the main trend. That is why, after the consolidation that we are seeing on the daily chart of the USD/CAD, the price may try to continue lower, due to the fact that the trend coming into the consolidation is bearish. Usually, during consolidations like this, the price may form a triangle, flag or pennant, which may all act as reversal or continuation patterns. If the price of the USD/CAD continues falling, then the 200 day EMA at the 1.2923 level may act as support. Below the 200 day EMA, the price may have the road clear all the way down to the 1.2739 level. On the other hand, if the USD/CAD tries to correct to the upside, then the 55 day EMA may act as resistance along with the 1.3100 level. Above the 1.3100 level, its next resistance could be the 1.3200 or the peaks at the 1.3387 level.

Resistance on the Dollar seems unbreakable

The Dollar index visits one more time the 95.00 level from where it bounces to the downside during today’s session. The Dollar has weaken after the US jobs report came out lower than expected, but we must keep in mind that the 95.00 level has been a very good technical resistance for the instrument. In fact, the index has visited the 95.00 zone at least 12 times since the end of May. However, the daily candle lows are getting higher than the previous ones, which is an indication that the pressure is pushing to the upside. The index keeps a bullish trend, since the 55 day EMA is still pointing to the upside, but the trend is losing its momentum. The index may be waiting for the FED to raise its rates possibly in September to take a clear direction. For now, the 94.00 level may still act as support, along with the 55 day EMA. The 200 day EMA at the 93.00 level may be a longer term support for the Dollar index.

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Possible support on the USD/CAD

On the daily chart of the USD/CAD we can see that the pair has been falling from the double top formation that it created around the 1.3387 level. Once the price reaches the 55 day EMA (purple line), it tries to consolidate, but the bearish momentum continues and the price of the USD/CAD breaks below the 1.3100 level and below the 55 day EMA to reach the 1.3000 level. The last few daily candles are in the shape of a doji and that is an indication that the pair is undecided at the moment and the 1.3000 level may act as support. Therefore, if the price bounces to the upside from the 1.3000 level, the 55 day EMA along with the 1.3100 level may act as resistance. On the other hand, if the price breaks below the 1.3000 level, then the 200 day EMA (blue line), around the 1.2920 level may act as support. The most relevant support is at the 1.2739 level where it bounced to the upside in the past.

Symmetrical triangle on the EUR/USD

The EUR/USD on the daily chart has been consolidating and inside such consolidation, a symmetrical triangle has formed. The symmetrical triangle could act as a continuation patter, but the price may breakout in any direction, really. The range inside the triangle starts to shrink and that causes the pressure to accumulate until the price breaks out in any given direction. To the upside, the price of the EUR/USD may find some resistance at the 200 day EMA, around the 1.1868 level. Above the 200 day EMA, its next resistance could be the 1.2000 level. To the downside, the 1.1500 level may act as support, but in case of a breakdown, the EUR/USD may find another support at the 1.1400 level.

Consolidation on gold

Gold has entered into a consolidation phase as shown on the daily chart of the precious metal. The price of gold consolidates between the 1211 level as support and the 1236 level as resistance. Inside the consolidation, gold has formed what it appears to be a bearish flag or pennant. It is called a bearish flag, because the trend coming into the consolidation is bearish. Therefore, there is a higher probability of seeing a breakdown to the 1200 level, which could act as support. But the price may also break to the upside and form a pullback or correction. Above the 1236 level, the 55 day EMA may act as a resistance, but a better resistance could be the 1273 level, due to the fact that at that level we can find its 200 week exponential moving average.

Death cross on copper

The death cross pattern is a moving average cross over pattern that has a very peculiar name due to the fact that the pattern has negative implications for the underlying asset in mid or longer term. The pattern has better chances of success on the daily chart. The pattern is confirmed when the 55 day moving average (purple line) crosses below the 200 day moving average (blue line). The cross is indicating us that the trend has reversed to the downside and the price may continue falling. At the same time we must keep in mind that when the cross happens, the price of the asset is already over-extended to the downside and probably ready for a correction. In fact, there is a 50% chance of seeing a pullback after a death cross is confirmed. The price of copper pulls back form the 270.00 zone to the 283.62 area where we can find the 200 week EMA. The price may continue falling, but the 270.00 level may act as a temporary support. However, if the price breaks below the 270.00 level, the bearish momentum may accelerate even more.