USD/CAD’s decline from 1.4667 resumed last week and hit as low as 1.3714. But as a temporary low was formed there, initial bias is turned neutral this week first. On the downside, focus will be on whether USD/CAD could decisive break 1.3664 key cluster support on next fall. On the upside, break of 1.4048 resistance will indicate near term bottoming and turn outlook bullish for stronger rise.
In the bigger picture, focus is now on 1.3664 cluster support (38.2% retracement of 1.2061 (2017 low) to 1.4667 at 1.3672. As long as this support holds, rise for 1.2061 is seen as in progress and should resume through 1.4667/4689 resistance zone at a later stage. However, sustained break of 1.3664 will argue that consolidation from 1.4689 (2016 high) is extending with another fall leg. Deeper decline would be seen to 61.8% retracement at 1.3056 and possibly below.
In the longer term picture, up trend from 0.9506 is (2007 low) is in progress. Decisive break of 1.4689 will 1.6196 (2002 high). This will remain the favored case as long as 55 month EMA (now at 1.2944) holds.