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Dollar/CAD dipped under 1.25 and is not that far from the critical support line of 1.2460. Has it gone too far? Here is the view from SocGen:

Here is their view, courtesy of eFXnews:

Societe Generale FX Technical  Strategy Research  notes that USD/CAD has reintegrated within the steeper channel since 2012 and has accelerated its decline towards 1.25/1.2460 which is corresponding to last year through and is close to the 38.2% retracement of whole up move from 2007.

“More importantly it is closing in on the lower bound of the aforementioned channel. Weekly stochastic has now reached a pivotal floor which suggests the  correction looks a bit overstretched.

1.25/1.2460  will be a crucial level; a tentative pause can’t be ruled out once this is achieved.

Short term, the pair has reached the lower bound of an hourly channel, however, a move beyond immediate hurdle at  1.2620  is needed to signal early signs of recovery,” SocGen argues.

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