Hello traders! On June 19 GBP/CAD tested the low at 1.6750, and since then there has been a very stable uptrend. The key resistance at 1.7200, along with the 200 Simple Moving Average were both broken on July 27. I’ve applied the Fibonacci retracement indicator to the small pullback after the resistance breakout to find any correspondence to the previous levels of resistance.
It shows that 727.2% Fibs at 1.7801 corresponds to the previously established higher high, established back on the 31 March. This might be a potential final upside target for the expected uptrend, especially considering that it goes incline with the upper trendline of the extended ascending channel.
And the reason why the uptrend is expected is because of the breakout of the 200 EMA, a breakout above the downtrend trendline, rejection of the downtrend trendline, rejection of the 61.8% Fibs, and the rejection of the middle trendline of the extended ascending channel.
There are far too many rejections of different support indicators, which means that as long as price remains above the recent low at 1.7350, GBP/CAD uptrend probability remains very high.
There are two main resistance levels, with the nearest located at 1.7678, which is 88.6% Fibonacci retracement level. Daily break and close above this resistance is likely to result in further growth, towards the 1.7800 psychological resistance, which we have mentioned already.
Bias: Strongly bullish while above 1.7350
Potential Support Zone: 1.7400 – 1.7450
Potential Targets: 1.7678, 1.7800
Have a profitable trading!