steve.jarvis's picture

Canadian Dollar turned bearish 6 weeks ago - no light yet at the end of the tunnel

For the first half of 2015, the Canadian Dollar was a mid ranking Currency, enjoying brief spells of strength and bouts of weakness, but generally stuck firmly in the neutral category.  For 16 of those 26 weeks I had classified the Canadian Dollar as neutral, with just 5 weeks spent in an uptrend and 5 weeks in a downtrend.

Six weeks ago, I detected the Canadian Dollar's trend had turned bearish and since that time it has remained firmly in negative territory. Could this be the start of a prolonged period of Canadian Dollar weakness, or has the worst already passed? 

Having analysed the Canadian Dollar versus all of the other major Currencies, it presently looks bearish on a multi-week basis against virtually everything else.  It looks least bearish against the Norwegian Kronor & Australian Dollar, but in both of these cases it also looks fragile and is close to key levels of support, a break of which could trigger a further lurch lower for the Canadian Dollar.

A selection of Canadian Dollar charts are shown below,  all with the Canadian Dollar on the left side of the quote (opposite to how a number of crosses are most commonly quoted), as this brings homes the performance and trend for the Canadian currency.  The long-term (260 day / 1 year) moving average is in blue, with the red & green lines representing the 22 & 65 day (1 & 3 month) lines.  Notice their direction and also that the MACD is generally below the zero line , indicating a downtrend.

From left to right.  CAD/USD                                                  CAD/GBP                                                                 CAD/EUR

 

 

 

 

From left to right.      CAD/JPY                                                      CAD/NZD                                                                   CAD/SEK

 

 

 

 

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