USDCAD declined to as low as 1.3312 last week but lost momentum ahead of 1.3299 support. Initial bias is turned neutral this week first. On the upside, break of 1.3460 resistance will turn bias back to the upside for 1.3653 resistance, to extend the triangle consolidation pattern from 1.3976. However, sustained break of 1.3299 will indicate that larger corrective fall is underway, and target 100% projection of 1.3860 to 1.3299 from 1.3653 at 1.3092.
In the bigger picture, rise from 1.2005 (2021 low) is expected to resume through 1.3976 after consolidation from there completes. On decisive break of 1.3976, next target will be 1.4667/89 long term resistance zone. This will remain the favored case as long as 38.2% retracement of 1.2005 to 1.3976 at 1.3233 holds. However, sustained break of 1.3233 will pave the way to 61.8% retracement at 1.2758, and raise the chance of bearish reversal.
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.
