Daily Pivots: (S1) 1.2795; (P) 1.2826; (R1) 1.2877; More….
USD/CAD’s rally continues today and reaches as high as 1.2884 so far. Intraday bias remains on the upside for 38.2% retracement of 1.4689 to 1.2061 at 1.3065 next. As noted before, medium term down trend from 1.4689 high could have reversed. Sustained break of 1.3065 will pave the way to 1.3793 key medium term resistance next. On the downside, below 1.2780 minor support will turn intraday bias neutral first. But downside of retreat should be contained by 1.2598 resistance turned support and bring rise resumption.
In the bigger picture, USD/CAD should have defended 50% retracement of 0.9406 (2011 low) to 1.4869 (2016 high) at 1.2048. And with 1.2048 intact, we’d favor the case that fall from 1.4689 is a correction. Break of 1.2777 further affirms this bullish case. That is, larger up trend from 0.9406 is not completed. And USD/CAD should now target 1.3793 key resistance next. However, on the other hand, firm break of 1.2048 will indicate that fall from 1.4689 is at least a medium term down trend and should target 61.8% retracement at 1.1424 and below.
