USD/CAD’s fall from 1.4791 resumed last week and hit as low as 1.4026. But it then recovered notably, ahead of 1.3946/76 support zone. Initial bias remains neutral this week first. On the upside, break of 1.4414 resistance will suggest that the decline has completed as a three wave correction, and turn bias back to the upside for retesting 1.4791 high. However, firm break of 61.8% projection of 1.4791 to 1.4150 from 1.4414 at 1.4018, could prompt downside acceleration to 100% projection at 1.3773 next.
In the bigger picture, focus is now on 1.3976 resistance turned support (2022 high), which is close to 55 W EMA (now at 1.3992). Strong rebound from there will retain medium term bullishness. That is, up trend from 1.2005 is still in progress for breaking through 1.4791 at a later stage. However, sustained break there should confirm medium term topping at 1.4791. Deeper correction would be seen to 38.2% retracement of 1.2005 (2021 low) to 1.4791 at 1.3727.
In the longer term picture, up trend from 0.9506 (2007 low) is in progress and possibly resuming. Next target is 61.8% projections of 0.9406 to 1.4689 from 1.2005 at 1.5270. While rejection by 1.4689 will delay the bullish case, further rally will remain in favor as long as 55 M EMA (1.3491) holds.
