- GBP/CAD is extending consolidation below 100-DMA, bias lower.
- The pair trades with a bearish bias. We see scope for further downside.
- Price action holds support at 38.2% Fib at 1.7430, break below to see further weakness.
- Momentum studies bearish, Stochs deep in oversold zone. We see -ve DMI dominance and ADX is rising in support.
- RSI shows weakness, well below 30 levels and bearish divergence on RSI and Stochs adds to bearish bias.
- Break below 38.2% Fib finds next major support at 1.7126 (50% Fib) ahead of 1.7096 (200-DMA).
- On the flipside, 5-DMA is immediate resistance. Bearish invalidation seen above 100-DMA at 1.7603.
Support levels - 1.7430 (38.2% Fib), 1.73 (Jan 29 low), 1.7126 (50% Fib), 1.7096 (200-DMA)
Resistance levels - 1.7505 (5-DMA), 1.7603 (100-DMA), 1.7663 (Feb 8 high)
Recommendation: Good to stay short on break below 38.2% Fib, SL: 1.7550, TP: 1.73/ 1.72/ 1.7130
FxWirePro Currency Strength Index: FxWirePro's Hourly GBP Spot Index was at -107.694 (Bearish), while Hourly CAD Spot Index was at -67.2971 (Neutral) at 1200 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
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