GBPCAD looks ready to resume its long-term climb after months of consolidation in a short-term rising channel. Price is starting to close above the resistance of the small channel to aim for the top of the larger one.

However, the 100 SMA is below the longer-term 200 SMA to indicate that the path of least resistance is to the downside. This suggests that resistance is more likely to hold than to break. Then again, GBPCAD has broken above the 100 SMA dynamic inflection point and might be aiming for the 200 SMA next. The gap between the moving averages is also narrowing to signal weakening selling pressure.

RSI is still heading up to indicate that there’s some bullish energy left. This could be enough to take GBPCAD at least until the mid-channel area of interest around the 1.8000 handle. Stochastic also has some room to climb before hitting the overbought zone, but the oscillator appears ready to move south already.

In that case, a move back to the bottom of both channels at the 1.7000 mark could be in the works or a brief pullback to the broken short-term channel top might suffice.

All this could hinge on Brexit developments in the coming days as the UK parliament is bound to reject PM May’s Plan B, keeping the possibility of a “no deal” divorce in play. However, European officials might be keen to avoid this situation, so there’s always a chance of a last-minute arrangement.

Meanwhile, commodities and higher-yielding currencies are under pressure due to global growth slowdown expectations. The IMF downgraded forecasts on account of trade tensions between the US and China and the cancellation of upcoming talks between the two nations is also keeping traders on edge.

The Loonie is likely to take cues from crude oil as well, and a larger than expected build in stockpiles could bring bearish moves.