USD/CAD posted little gains today as the USDX ha managed to rebound after the last day’s sell-off. The pair is into a corrective phase on the short term, but we could see another upside movement if it will fail to make a valid breakdown below the near-term support lines.

You should be very careful in the upcoming hours because the US and the Canadian data could shake the price.

The USD/CAD decrease could be a temporary one and the rate could start to increase again. This scenario will take shape only if the USDX will increase and will recover after the last downside momentum.

The US Unemployment Claims could increase to 215K from 212K, while the New Home Sales could jump from 631k to 643K. Unfortunately for the dollar, the Flash Services PMI could slip from 56.0 to 55.9 points, while the Flash Manufacturing PMI could decrease from 55.3 to 55.1 signaling that the expansion is slowing down.

It remains also to see what the Jackson Hole Symposium will bring, maybe we’ll have some significant volatility in the upcoming days.

The pair has failed to make a valid breakdown below the inside 50% Fibonacci line of the descending pitchfork in the last attempts, so another false breakdown or a failure to reach it will send the rate higher and maybe we’ll have a breakout above the upper median line (uml).

The retreat was expected after the false breakout above the median line (ML) of the major ascending pitchfork and after the failure to retest the ML and the upper median line (uml).

We have an important downside target also at the downside 50% Fibonacci line of the major ascending pitchfork.

A further drop will be confirmed after a valid breakdown below the near-term 50% Fibonacci lines.