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USDCAD, Candlestick Analysis

12/27/2022 10:13 AM


On the four-hour chart, there is a two-week consolidation of the asset in the range of 1.3564–1.3746. Currently, a series of Shooting Star reversal candle patterns has formed below the resistance level of 1.3746, which warns traders that the market is under the influence of the "bears". The formation of the next Gravestone Doji candlestick below 1.3621 and the presence of a gap down also confirm the strength of the sellers. The combination of these figures means that the quotes of the trading instrument are likely to continue the downtrend towards the support level of 1.3507, the successful overcoming of which will allow sellers to reach 1.2983. An alternative scenario is possible if the price rebounds from the level of 1.3507, then it may head towards the resistance zone 1.3621–1.3984.


On the daily chart, there is a formation of a Symmetrical Triangle price pattern, which warns traders about the ongoing uncertainty in the market: the price from this Triangle can go both down and up. However, the presence of reversal Bearish Engulfing patterns and the Shooting Star pattern in the narrowing Triangle indicates that the initiative is in the hands of sellers. Besides, at present the sellers managed to overcome the lower border of the figure, which, in turn, indicates a further price decline to the support level of 1.3507. If the "bulls" fail to keep this level, one should expect further movement of the asset in the range of 1.3261–1.2983.

Support levels: 1.3507, 1.3261, 1.2983. | Resistance levels: 1.3621, 1.3746, 1.3984. 

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