Technical analysis
The daily time frame continues to show a large head and shoulders pattern is still valid despite last week’s strong price recovery in the USDCAD pair.
The USDCAD pair remains technically bearish under its trend defining 200-day moving average, which is located close to the 1.2580 resistance level.
What the possible outcomes are
In our most likely scenario, the USDCAD pair will test back towards its 200-day moving average and then start to decline back towards the 1.2250 support level.
Alternatively, the USDCAD pair could start to decline from current levels and remain in a range between the 1.2600 and 1.2440 price levels.
Key levels
Support 1.2440 1.2250
Resistance 1.2580 1.2650
