USD/CAD
Resistance 1:  1.0200; Resistance 2: 1.0260
Support 1: 1.0150; Support 2: 1.0110

USD/CAD 11/18/2010

The USD/CAD formed a triple top with the base at 1.0200. The 1.0200 level is thus the near-term resistance. So far the market has not been able to push back into the triple top zone. The RSI is also breaking below 40, so the bullish scenario is not healthy anymore, and the bearish scenario is brewing in this short-term look. The bullish scenario is still preferred unless the market breaks below 1.0150. The bullish scenario resumes, if the market is able to first break above 1.0230. We also should confirm with a break above the previous 1.0260 pivot. The minor 1.0230 is the middle pivot and if broken would be an early warning for the bullish scenario towards 1.0350/1.0400 area.

AUD/USD
Resistance 1: 0.9900; Resistance 2: 1.00.
Support 1: 0.9820; Support 2: 0.9725

Indeed the AUD/USD bearish scenario is hold after our bullish divergence and RSI breaking above 60 then 70. The price action rallied to the 0.9900 pivot and has stalled since giving some minor reversal sentiments, but materializing in sideways consolidation. However if a correction is developed, look at the 0.9820 level to hold. If it does not, the bearish scenario should resume, and you should look for a decline towards 0.9725. (There is a minor pivot at 0.9770 as well.) Note that a break above 0.9900 first encounters 50% retracement at 0.9910, but after that the 1.00 level is 61.8% retracement and should have more significant resistance factors.

Gold (XAU/USD)

Resistance; 1: 1364.00; Resistance 2: 1378.00.
Support 1: 1350.00 (breaking); Support 2:  1342.00 Support 3 1330.50.

Gold 11/18/2010

Gold broke above 1350, but failed to reach 1364. A break below 1350 begs to test 1342/1340 pivot. If the market stays above that it is not done with the correction to the recent downtrend (which is a correction to the long-term bull run in gold). The RSI shows bullish momentum breakout, and if it stays above 40, we should see some further bullish correction, or even a resumption of the long-term bull run. I would first target 1378 in the near-term, anticipating a break above 1364. However if gold is not done with the bearish correction, it should continue lower towards 1325. There is a bunch of support between 1325 and 1310, so look for this zone to create bottom in the XAU/USD.

Are commodity currencies and gold still a strong play? We would love to hear what you think.

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