Daily Pivots: (S1) 1.3432; (P) 1.3476; (R1) 1.3543; More….
USD/CAD’s rally extends after brief retreat and drew support from 4 hour 55 EMA. The break of 1.3543 resistance confirms resumption of rise from 1.2968. Intraday bias stays on the upside for 1.3598. Firm break there will resume whole rally from 1.2460 to next medium term fibonacci level at 1.3838. On the downside, break of 1.3410 support is needed to indicate short term topping. Otherwise, outlook will remain bullish in case of retreat.
In the bigger picture, price actions from 1.4689 medium term top are seen as a correction pattern. The first leg has completed at 1.2460. The second leg from 1.2460 is likely still in progress and could target 61.8% retracement of 1.4689 to 1.2460 at 1.3838. We’d look for reversal signal there to start the third leg. However, break of 1.2968 will argue that the third leg has already started and should at least bring a retest of 1.2460 low. Meanwhile, sustained trading above 1.3838 would pave the way to retest 1.4689 high.
