(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)
Price action on USD/CAD, a daily chart of which is shown above, is currently consolidating just below a key downtrend resistance line extending from the fourth test of the 1.3 area high made back in early March.
Any breakout to the upside of this trend line with follow-through momentum should target key resistance in the 1.2500 region. To the downside, the 1.2000 price region should continue to serve as strong psychological support, and any major breakdown of 1.2000 should likely target further support in the important 1.1800 price region.
By James Chen, Chief Technical Analyst, FX Solutions
