Watch out Aussie bears! It seems that the bulls are jumping back in the markets, hoping to regain some of the ground they lost the past couple of weeks. From the looks of it, the bulls are pushing price towards the 0.8950-0.9000 price region, somewhere around the 0.500 and 0.618 Fibonacci retracement level. The question is, are they strong enough to take the price all the way there? With stochastic at overbought territory, the bears could start selling the pair again as soon as price hits the 0.382 Fibonacci retracement level (0.8900). If that happens, a retest of the previous swing low at 0.8740 is likely.
Ranging, ranging and more ranging! That’s all we’ve been seeing the past few weeks, as the USDCAD pair has been bouncing back and forth. The pair has been finding resistance around the 1.0730 to 1.0750 price area, unable to breakthrough it. Every time it’s tried to break past that level, bears have brought price action back down. Recently, the price action dipped below the 1.0500 mark once again and tested support at the 1.0430 to 1.0450 price area. With stochastic showing oversold conditions, will we see buyers come back in force? If support holds, we could see buyers test resistance once again. On the other hand, if selling pressure remains strong, we could see a break of the support area and price could fall and test yearly lows near 1.0250.
Lastly, let’s end with a look at the Kiwi! Last week, we saw a strong down move that caused a breakdown of the rising trend line that had been holding for a couple of weeks. With sellers coming out at full force, price dipped all the way down to the 0.7000 handle. Recently however, price has retraced a bit and is now testing the former trend line. Could the trend line now serve as a support turned resistance? Stochastics indicate overbought conditions, so buying pressure may not be enough to push past resistance. We could see price retest the 0.7000 price area. On the other hand, if Kiwi bulls continue to push price up, we could see price zoom all the way to former highs just below 0.7300.