Daily Pivots: (S1) 1.2418; (P) 1.2541; (R1) 1.2605; More….
USD/CAD’s drops sharply to as low as 1.2339 and break of 1.2412 low confirms resumption of medium term fall from 1.3793. Intraday bias is back on the downside. Current decline should now target next long term fibonacci level at 1.2048. On the upside, above 1.2490 minor resistance will turn intraday bias neutral again. But outlook will remain bearish as long as 1.2662 resistance holds.
In the bigger picture, price actions from 1.4689 medium term top are seen as a correction pattern. Such corrective fall is still expected to extend to 50% retracement of 0.9406 to 1.4869 at 1.2048. At this point, we’d look for strong support from there to contain downside and bring rebound. Nonetheless, on the upside, sustained break of 1.2968, 38.2% retracement of 1.3793 to 1.2412 at 1.2940 will be the first sign of completion of the correction and will turn focus back to 1.3793 key resistance.