Monday, 26 October 2009
Recent commentary was that “the entire rally from 1.0782 has now been retraced. However, the drop below 1.0782 may be wave Y in a complex W-X-Y corrective decline from 1.3068. Daily RSI has turned up from oversold (which was also divergent with the low). The USDCAD rally has picked up steam and cleared initial resistance at 1.0940. The advance has the characteristics of an impulse and the decline has stalled at the 61.8% of the rally. If the USDCAD is to turn up, then this is a good place for it to do so.” The pair did turn up and price has now cleared 1.1108. A 3rd wave is probably underway from 1.0791. Dips should be bought against that level. 1.0972-1.1027 is a support zone.