Daily Pivots: (S1) 1.3022; (P) 1.3058; (R1) 1.3076; More

USD/CAD drops further to as low as 1.3023 so far today. The break of 1.3049 support suggests that rebound form 1.2961 has completed at 1.3173 already. The pair is also kept well inside near term falling channel. Intraday bias is back on the downside for 1.2961 first. Break there will resume whole decline from 1.3385. More importantly, that will also break medium term channel support firmly and carries larger bearish implications. On the upside, break of 1.3173 is needed to confirm completion of fall from 1.3385. Otherwise, risk will now stay on the downside even in case of recovery.

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In the bigger picture, as long as channel support (now at 1.2965) holds, we’re holding to the bullish view. That is, fall from 1.4689 (2015 high) has completed at 1.2061, ahead of 50% retracement of 0.9406 (2011 low) to 1.4689 (2015 high) at 1.2048. Further rally should be seen for 61.8% retracement of 1.4689 to 1.2061 at 1.3685 and above. However, sustained break of the channel support will argue that rise from 1.2061 has completed. Further decline should be seen to 38.2% retracement of 1.2061 to 1.3385 at 1.2879 first. Sustained break will pave the way to 61.8% retracement at 1.2567 and below.

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