USD/CAD at 1.05; Stalking for Topping Action

4H: The USD/CAD was seen rallying towards 1.05 in yesterday's USD/CAD update. This was going to be a pullback to the previous support now tested as resistance.

The market is there at the beginning of the US session, so let's stalk this market for topping action using the 15-min charts.

15-min: As I drew on the invalidating scenario and the confirming scenario, the market in the 15-min chart is moving below 1.0450, which was the support of the recent consolidation range.

If the market can offer a pullback that fails to break into this consolidation zone, we have a bearish attempt at hand.

Also, the RSI should break below 40, and preferably break below 30. A RSI rally that fails to break above 50 also hints at imminent attempt at the bearish scenario.

Day: When the market was rejected from staying above 1.0650 it suggested it wanted to return to equilibrium of the range.

Now the market might be saying that it respects the topping area between 1.05 and 1.0650. If so, it is now more likely it will decline below 61.8% retracement level at 1.0325. Instead the 1.02 area can become the target.

Still, the market is ranging and not bearish, so it may also be prudent to have an emergency exit strategy.