USD/CAD Forecast January 27, 2014, Technical Analysis

The USD/CAD pair initially fell during the course of the session on Monday, but as you can see bounced enough to form a hammer. That hammer of course suggests that the market is ready to go higher, but we need to get above the 1.25 level in order to have clearance in a market that could go much, much higher given enough time. Ultimately, we feel that the market should continue to go higher but we could get a little bit of a pullback in the meantime as this area of course is a large, round, psychologically significant number. So in other words: we are buying pullbacks, and most certainly buying breakouts.