Daily Pivots: (S1) 1.2998; (P) 1.3024; (R1) 1.3063; More….
USD/CAD is staying in consolidation from 1.2928 temporary low and intraday bias remains neutral first. With 1.3097 resistance intact, further decline is expected. On the downside, break of 1.2928 will extend larger decline to 61.8% projection of 1.4667 to 1.2994 from 1.3389 at 1.2355. On the upside, however, firm break of 1.3097 will indicate short term bottoming and turn bias to the upside for stronger rebound.
In the bigger picture, fall from 1.4667 is seen as the third leg of the corrective pattern from 1.4689 (2016 high). Rejection by 55 week EMA is keeping outlook bearish. Sustained break of 61.8% retracement of 1.2061 to 1.4667 at 1.3056 will target a test on 1.2061 (2017 low). But we’d expect loss of downside momentum as it approaches this key support. On the upside, firm break of 1.3389 resistance is needed to indicate medium term bottoming. Otherwise, outlook will remain bearish in case of rebound.
