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FX: USDCAD Harmonic Pattern Signals Bearish Move

Interval: Daily

usdcad-harmonic-pattern-bearish-01.03.2013

USDCAD has broken 1.0000 level in the first half of the month and after that the chart was drawn only straight up to 1.035, with no important corrective moves. This should attract the attention and investor must be more attentive to bearish signals.

On the daily chart we can find these signals. First is a harmonic pattern, Bearish Bat, with the potential reversal zone (PRZ) between 1.035 and 1.40. These levels are also Fibonacci levels; the first one is an 88.6 retrace of the move XA and a 261.8 expansion of BC move.

Using this type of technical analysis, we should look for price action reversal signals near or inside the PRZ, D point. On our chart we can see that the last candle resembles to a Shooting Star, but we still need to wait for the end of this session to see if it will be confirmed. Another one can be the RSI 28 is pretty close to the overbought zone after it got over the channel upper line.

The targets for this pattern are 1.0215 and 1.0100; the first one is pretty close to a trend line that was broken. Keep an eye on the site for updates.

 

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