USD/CAD analysis 12 July 2011
Underpinned by growing investor risk aversion, softer commodity & oil prices (Nymex crude settled down $1.05 yesterday at $95.15/bbl). Data focus: 1230 GMT Canada May international merchandise trade. USD/CAD daily chart positive-biased as stochastics have turned bullish from oversold; negative MACD histogram bars contracting. Resistance at 0.9695 (yesterday's high, matching Wednesday's reaction high and confluence of 55-day and 100-day moving averages); breach would expose upside to 0.9825 (June 29 high), then 0.9885 (June 28 high) and 0.9913 (June 27 high). Support at 0.9654 (hourly chart), then at 0.9599 (yesterday's low); breach would expose downside to 0.9569-0.9565 band (Friday's low-Thursday's low), then 0.9509 (May 11 reaction low), 0.9436 (April 29 bottom) and psychological round-numbered level of 0.9400.