Hello traders! On November 9, USD/CAD bottomed out while testing the 1.2928 low. Then the price went up and broke above the downtrend trendline as well as the previous higher high at 1.3029. Then price corrected down and cleanly rejected the 50% Fibonacci retracement level at 1.2985. This might suggest the potential trend reversal or at the very least a strong upside correction.
Today USD/CAD bounced off the 1.3029 support, which a few days ago acted as the resistance. Higher highs and higher lows are in place, suggesting the validity of a short term uptrend. Therefore as long as the price stays above the recent low at 1.2928, USD/CAD should be expected to continue rising.
There are two key resistance levels, both of which are confirmed by two Fibonacci retracement levels. The first is at 1.3291 and the second is at 1.3331. This makes a growth potential of nearly 300 pips, which might be taking place throughout this and next week.
Concerning the downside potential, the first sign of further weakness would be a break below the 1.2985 Fibonacci support. But only upon the break below the 1.2928 low, the bearish forecast will be completely invalidated and USD/CAD is likely to continue trending down.
Bias: Strongly bullish while above 1.2928
Potential Support Zone: 1.3000-1.3040
Potential Targets: 1.3291, 1.3331
Have a profitable trading!