Credit Suisse analyzes the USD/CAD currency pair and identifies a potential "double bottom" base formation, indicative of a more substantial move upwards. Here are the critical details:
Potential Double Bottom Base: Credit Suisse sees a possibility for a "double bottom" base if USD/CAD trades above 1.3389 on a sustained basis. Closing above this level would signal a more concerted move higher.
Next Key Resistance: If the pair moves above 1.3389, the next significant resistance is identified at the 200-day average, currently at 1.3454. While this level might act as a cap initially, a close above this point would reinforce the base, paving the way for resistance next at 1.3478/80.
Bullish Divergence: The daily Relative Strength Index (RSI) momentum already shows signs of a base and bullish divergence, adding to the positive outlook.
Support Levels: Immediate support is seen at 1.3358, and 1.3319 needs to hold to maintain the upside bias. A fall below these levels could reassert a broader sideways range, with further support at 1.3304/02, then 1.3285.
Key Points:
- Credit Suisse identifies a potential "double bottom" base for USD/CAD if it sustains trading above 1.3389.
- Resistance levels are mapped out at 1.3454, followed by 1.3478/80, signaling further upward potential.
- Bullish divergence in the daily RSI momentum supports the positive outlook.
- Immediate support is at 1.3358, with levels below reasserting a more neutral range.
Conclusion: Credit Suisse's analysis of USD/CAD suggests potential bullish movement if the pair can sustain trading above the critical level of 1.3389. The identification of a "double bottom" base, along with the bullish divergence in RSI, paints a picture of upward potential, with resistance and support levels clearly delineated. Market participants may find this analysis valuable in forming expectations for the currency pair's short-term trajectory.
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