Daily Pivots: (S1) 1.3196; (P) 1.3232; (R1) 1.3301; More…
USD/CAD rebounded strongly after hitting 1.3160, ahead of 38.2% retracement of 1.2781 to 1.3359 at 1.3138. But upside is limited below 1.3359 and intraday bias is turned neutral first. On the upside, decisive break of 1.3359.85 resistance zone will confirm resumption of medium term up trend. But before that, risk remains mildly on the downside for another fall. Break of 1.3160 will target 61.8% retracement at 1.3002.
In the bigger picture, current development argues that medium term corrective pattern from 1.3385 is extending with another falling leg. While deeper decline could be seen, downside should be contained by 50% retracement of 1.2061 to 1.3385 at 1.2723 to bring rebound. An eventual upside break out is still expected to 61.8% retracement of 1.4689 (2016 high) to 1.2061 at 1.3685, at a later stage.
