Price dropped further today and extended the impressive sell-off, but has found temporary support at the 1.2061 level. USD/CAD has started to increase in the last hours, but this rebound could be only temporary because it could drop further if the Canadian data will come in better than expected. The minor throwback is natural after the immense drop, it seems too oversold to resume the bearish momentum, but the fundamental factors will lead the rate again in the upcoming hours.
As you already know, Canada is to release high impact data, the Employment Change could increase from 10.9K to 17.8K in August, could reach the highest level of the last two months and could lift the Loonie even more. The Unemployment Rate could remain steady at 6.3% for the second month in August. Moreover, the Capacity Utilization Rate could be reported at 84.9%, higher versus the 83.3% in the former reading period.
Price has dropped and reached the 150% Fibonacci line (down sloping line), this could represent a major dynamic support if will hold. USD/CAD dropped below this line, but failed to stay there. Technically a false breakdown signals a rebound at least till the lower median line (LML) of the major descending pitchfork.
Price failed to reach and retest the inside sliding line (sl) of the minor descending pitchfork, signaling a potential exhaustion, but is premature to talk about this because the fundamental factors could lead it towards fresh new lows.
Technically a failure to reach the lower median line (lml) and the siding line (sl) shows an oversold and a potential leg higher.
