USD/CAD’s break of 1.3224 support last week indicates that deeper correction is underway. Initial bias stays on the downside this week for 100% projection of 1.3860 to 1.3299 from 1.3653 at 1.3092 next. On the upside, above 1.3353 minor resistance will turn intraday bias neutral and bring consolidations first, before staging another fall.
In the bigger picture, price actions from 1.3976 are still viewed as a correction to up trend from 1.2005 (2021 low), but chance of trend reversal is increasing with current decline. But in either case, sustained trading below 38.2% retracement of 1.2005 to 1.3976 at 1.3233 will pave the way to 61.8% retracement at 1.2758. Risk will stay on the downside as long as 1.3653 resistance holds, even in case of strong rebound.
In the longer term picture, price actions from 1.4689 (2016 high) are seen as a consolidation pattern only, which might have completed at 1.2005. That is, up trend from 0.9506 (2007 low) is expected to resume at a later stage. This will remain the favored case as 55 M EMA (now at 1.3046) holds.