USD/CAD with a promising shooting star candle on the D1

In today’s technical analysis, let’s focus on the American dollar to Canadian dollar (USD/CAD) pair, which is currently showing a potential reversal signal. The daily chart is forming a shooting star candlestick, highlighted in red, right at a key horizontal resistance level marked in orange. This resistance was the peak of the uptrend in October 2023. The upper wick of the shooting star indicates a false breakout above this resistance, suggesting a potential reversal if the pattern holds by the end of the trading day.

For the shooting star to be a valid sell signal, it must hold through the remainder of the European session and the American session. A confirmed shooting star at this level would suggest a good shorting opportunity, targeting the blue uptrend line and green horizontal support as potential profit levels. Conversely, if the price closes above the orange resistance, it would invalidate the bearish setup and signal a continuation of the uptrend, prompting a long position.

Traders should closely monitor how the USD/CAD pair behaves through the rest of the trading day. The key to this setup is whether the shooting star formation holds, offering a clear direction for the next trading move. The market’s response will be crucial in determining the short-term outlook for this currency pair.

Source: https://www.axiory.com/analytics/technical-analysis/usd-cad-with-a-promising-shooting-star-candle-on-t