The USDCAD pair initially fell during the course of the day on Friday, but turned around and form a hammer yet again.

I believe that this market is trying to build up enough momentum to finally break out to the upside, but at this point I would need see a daily close well above the 1.30 level, coinciding with a fall in the oil markets which is something that we are not getting at the moment.

Because of this, I think that volatility will be the main feature of this market, and caution should be applied.

Editor’s Note: Equity investors/traders can use the CurrencyShares Canadian Dollar Trust (FXC, quote) ETF to take positions in the euro without a FOREX account.  The ETF looks to track the price of the Canadian Dollar (USDCAD), minus ETF fee. The fund seeks to reflect the price of the Canadian Dollar with the shares representing a cost-effective investment relative to investing in the FOREX market.

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