[achiever]

USD/CAD – A soft close for the USD Thursday, just below the base of the
August/September consolidation (bear wedge), leaves the USD in a slightly weaker technical position again as we head into the end of the week. The market has been pressuring the bear wedge base all week and a daily close below should renew short term momentum for a test of the low 1.07 area. Spot intraday support at 1.0745 and resistance at 1.0790; stronger short term resistance remains 1.0880//00. Technically, the price action this week puts USD/CAD on track for a test of 1.03/1.04 initially and potentially 0.98 further out. Still want to sell rallies to try and capture what we may be a slightly steeper sell off in USD/CAD into the end of the year than we have seen already.

EUR/CAD – Another rather spectacular rejection of the 1.5850 area and failure to hold the 1.5780 pivot on a daily close basis implies that while the underlying trend may well be higher in this cross at the moment, the EUR will have some trouble extending gains significantly. From a short term point of view, mixed signals – trend higher but strong rejections of the highs and positive weekly but negative daily price action – keep us neutral. While spot holds above the short term MA
signals (11 and 21-day), the risk of a test through to the low 1.59 area remains. Double top trigger at 1.5404 distant but worth noting.

GBP/CAD – Sterling looks to be in a similar position to the euro against the CAD; there are some very mixed signals here to reflect on as well. The 200-day MA capped GBP/CAD yesterday and short term price action looks quite negative. Unless the market sells off significantly into the end of the day though, the weekly close may still be relatively bullish. It looks like a range trade still for the moment between the 200-day MA and the 1.74/1.76 medium term support area. Remain neutral.

CAD/JPY – The cross continues to respect the confines of a potentially bullish falling
wedge pattern but the CAD has slipped steadily lower this week to pressure “cloud” chart support at 84.15 currently. Consistency with the technical signals has not been a strong point for the cross in the past couple of weeks – with the market vacillating around the usually reliable 55-day MA pivot. A break under support in the low 84 region opens up the downside for a renewed test of 82.00/40 but we think this area provides strong medium term support for the CAD.