USD/CAD’s selloff accelerates as the US session goes on, as supported by NAFTA news. The break of 1.2814 support now raise the chance of a head and shoulder top reversal pattern. (ls: 1.3000; h: 1.3124; rs: 1.2942). But for now, we’d prefer to see sustained break of 38.2% retracement of 1.2246 to 1.3124 at 1.2789 to confirm.
Also bare in mind that such near term reversal would also indicate rejection by 38.2% retracement of 1.4689 to 1.2061 at 1.3065. And in that case, the rebound from 1.2061 could have completed as a corrective three waves pattern to 1.3124 too. And in that case, 1.2061/2246 support zone will be back in sight.
For now, we’ll wait and see if 1.2789 would be firmly taken out.
