USD/CAD plunged and has reached new lows as the USD was punished by the USDX’s massive sell-off. Price approaches some very important downside obstacles, so we may have a temporary rebound, but only if the USDX will increase a little as well on the short term.
As you already know, the BOC has maintained the Overnight Rate steady at 1.75% as expected. The Housing Starts indicator was reported at 213K, much above the 207K estimate.
USD/CAD decreased sharply after the failure to stabilize above the median line (ML). It is almost to reach the median line (ml) of the red descending pitchfork, where it could find temporary support. We have a very important support also at the downside 50% Fibonacci line of the major ascending pitchfork. Maybe it could be attracted by the confluence area formed between the 150% line and the 50% line. Technically, we may have a temporary rebound after the massive drop. A temporary rebound could give us a great chance to go short again on this pair.
The next days could be crucial for the USD because the USDX has continued to drop, so a valid breakdown below the near-term support levels will announce the USD’s crash.