Daily Pivots: (S1) 1.2467; (P) 1.2512; (R1) 1.2563; More….
USD/CAD’s recovery suggests that pull back from 1.2598 has completed at 1.2432 already. Intraday bias is turned back to retest 1.2598 first. Break will extend the rebound from 1.2061 to 1.2777 resistance next. In case the consolidation from 1.2598 extends with another fall, downside should be contained by 38.2% retracement of 1.2061 to 1.2598 at 1.2393 to bring rally resumption.
In the bigger picture, USD/CAD should have defended 50% retracement of 0.9406 (2011 low) to 1.4869 (2016 high) at 1.2048. And with 1.2048 intact, we’d favor the case that fall from 1.4689 is a correction. Break of 1.2777 will further affirm this bullish case. That is, larger up trend from 0.9406 is not completed. And in that case, USD/CAD should target 1.3793 resistance next. However, on the other hand, firm break of 1.2048 will indicate that fall from 1.4689 is at least a medium term down trend and should target 61.8% retracement at 1.1424 and below.
