Daily Pivots: (S1) 1.2388; (P) 1.2453; (R1) 1.2492; More….

With 1.2326 minor support intact, further rally is expected in USD/CAD. The pair should have successfully defended key long term fibonacci level at 2.1048. Rise from 1.2061 should extend to 1.2777 resistance first. Decisive break there will target 38.2% retracement of 1.4689 to 1.2061 at 1.3065 next. However, break of 1.2326 will dampen this bullish view and turn bias back to the downside for 1.2061 instead.

In the bigger picture, focus remains on 50% retracement of 0.9406 (2011 low) to 1.4869 (2016 high) at 1.2048. As long as this level holds, we’d still favor that case that fall from 1.4689 is a correction. Rebound from 1.2048 could extend the larger up trend from 0.9406. However, firm break of 1.2048 will indicate that fall from 1.4689 is at least a medium term down trend and should target 61.8% retracement at 1.1424 and below.

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