USD/CAD rallied and now is pressuring a very, very strong dynamic resistance. It remains to see if the rate will have enough directional energy to be able to make a valid breakout. Technically, is is somehow expected to increase further after another false breakdown below a dynamic support and after a rejection from a dynamic support.

USD/CAD will resume the upside momentum if the USDX will increase as well. Right now you should stay away and wait for a confirmation that the rate will jump higher. The USD has received support from the ISM Manufacturing PMI, which has increased from 58.1 to 61.3 points, beating the 57.6 points. The Final Manufacturing PMI increased from 54.5 to 54.7 points, exceeding the 54.5 estimate. Unfortunately, we had poor data from the US as well, it remains to see how the USD will react after the Total Vehicle Sales will be released.

The USDX is almost to hit the upside 50% Fibonacci line of the ascending pitchfork after the failure to reach and retest the inside sliding line (sl). Only a valid breakout will signal a further increase. A false breakout or another rejection will send the index down, which will force the USD to lose significant ground versus all its rivals.

USD/CAD is pressuring the upper median line (uml)  of the descending pitchfork. You can see that it has failed to reach this level in the previous weeks, so a valid breakout will announce a further increase towards the median line (ML) of the major ascending pitchfork.

Right now only a false breakout will send the rate down again and most likely it will make a valid breakdown below the 50% Fibonacci line.

Technically, the rate it is expected to increase after the false breakdown below the 50% Fibonacci line of the descending pitchfork, but as I’ve told you, we really need a valid breakout from the descending pitchfork’s body.