Daily Pivots: (S1) 1.2420; (P) 1.2536; (R1) 1.2613; More…
USD/CAD reversed sharply after edging higher to 1.2653 yesterday. Strong resistance was seen again from 55 day EMA, keeping near term outlook bearish. With break of 1.2470 minor support, intraday bias is now back on the downside for retesting 1.2363 low. Break there will resume the down trend from 1.4667. Nevertheless, firm break of 1.2653, with sustained trading above 55 day EMA, will indicate that it’s now in a larger scale rebound, towards 1.2742 resistance first.
In the bigger picture, fall from 1.4667 is seen as the third leg of the corrective pattern from 1.4689 (2016 high). Further decline should be seen back to 1.2061 (2017 low). In any case, break of 1.2994 support turned resistance resistance is needed to indicate medium term bottoming. Otherwise, outlook will remain bearish in case of strong rebound.
