The USD/CAD decreased little today and stays much above the 1.2483 yesterday’s low. Price has come down to retest a broken resistance level and now is somehow expected to climb much higher on the short term. However, the rate could drop much deeper to test and retest some important support levels before will start another upside momentum.
Right now is very important to see what will happen on the USDX, which is located right above a critical support, a drop somewhere below the 93.30 level will signal a further drop and a USD depreciation.
Technically, the price should increase again, but unfortunately, the fundamental factors will take the lead and will drive the price. We may have a high volatility tonight after the FOMC Minutes will be released, a disappointment will demolish the USD.
USD/CAD retested the upper median line (uml) of the minor descending pitchfork and now should increase again. It could still drop along the upper median line (uml) till will reach and retest the 1.2460 static support and the median line (ml) of the blue ascending pitchfork. The next upside targets are at the median line (ML) of the major descending pitchfork and at the 1.2678 horizontal resistance.
Only a drop within the descending pitchfork’s body will signal a broader drop in the upcoming period, this scenario will take shape if the traders will be disappointed by a dovish FED.