Hello traders! It seems like bulls are starting to lose control of the GBP/CAD currency pair. Price has recently cleanly bounced off the 76.4% Fibonacci retracement level, which is 1.7697. It was very close to the key psychological resistance which is based at 1.7700. After rejecting the Fibs, the price went down sharply and broke below the 20 Exponential Moving Average.
Prior to that, GBP/CAD had a clean bounce off the 20 EMA at 1.7390, but now this level has become the resistance.
There is one major support level, where price might be currently heading. This is 1.7120 support, which corresponds to two Fibonacci retracement levels and the crossing of the uptrend and the downtrend trendline.
Looks like it is only a matter of time before the price will go lower, but 20 EMA can potentially, once again act as the resistance. So overall, a small correction to the upside can be expected, although the prevailing trend is down. 4-hour candle break and close above the 74.76 resistance would invalidate bearish outlook and can result in the continuation of an uptrend.
Bias: Bearish while below 1.7476
Potential Resistance Zone: 1.7390 – 1.7476
Potential Targets: 1.7120
Have a profitable trading!