Recently, the USD/CAD cross has been “movin’ on up” as it broke through all kinds of resistance. Looking at a daily chart of the pair, we can see that it not only overcame the downtrend it has been mired in for almost a full year earlier this month, but has also broken out of the wide base that it has been stuck in throughout 2012. The strong breakout over the last few days also puts the cross well above parity and firmly in a new price “neighborhood”. While it is becoming extended now and likely due for a break soon, keep an eye on the U.S. Dollar to see if it maintains its recent strength as it has been inversely correlated with the markets for some time now and continued strength would likely add more pressure to stocks and equities.
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