March Canada dollar (D6H27) futures present a buying opportunity on fresh price strength.
See on the daily bar chart for the March Canadian dollar futures that prices are trending higher. See, too, at the bottom of the char that the moving average convergence divergence (MACD) indicator is in a bullish posture as the blue MACD line is above the red trigger line and both lines are trending up. The bulls have the near-term technical advantage.
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Fundamentally, Canada’s economy and political system are stable. Meantime, the U.S. dollar ($DXY) has been under pressure recently amid uncertainty regarding inflation and Federal Reserve policy. The Democrats taking control of the U.S. House and Senate in January appears to have pushed the U.S. dollar index and U.S. Treasury yields lower at mid-week.
A move in the March Canada dollar futures above chart resistance at last week’s high of .7214 would give the bulls more power and it would also become a buying opportunity. The upside price objective would be .7420, or above. Technical support, for which to place a protective sell stop just below, is located at .7130.
IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any trades and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.
Here is what the Commodity Futures Trading Commission (CFTC) has said about futures trading (and I agree 100%):
Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.
On the date of publication, Jim Wyckoff did not directly have a position in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com
