The USD/CAD has increased today and continues to fight to start another leg higher, will increase further if the United States economic data will support the dollar. The rate should jump higher if the USDX will have enough energy to climb and o stabilize above the 101.00 psychological level, right now is trading right below this upside obstacle, so remains to see what will happen in the coming days.
The USD/CAD is moving sideways on the short term, technically is somehow expected to increase, personally I believe that only the fundamental factors could drive the rate lower at this moment. However, we still need a confirmation that the rate will start an upward movement, could jump higher after several false breakouts.
The price has increased somehow surprisingly today and the USDX has decreased a little and also because the Canadian Wholesale Sales indicator has increased by 0.7% in December, more versus the 0.4% estimate and more compared to the 0.1% growth in November. Most likely the price has increased because is too oversold to stay lower, could continue to move sideways before we’ll have a confirmation that we’ll have a larger rebound.
The price has increased, but continues to trade below the 1.3126 Friday’s high, is very important now to close above the third warning line (Wl3) of the former ascending pitchfork. Could increase after the false breakout below the 1.3047 static support and after the failure to close on the median line (ML) of the major descending pitchfork. Is somehow expected to increase also because the behavior has changed when the rate has started to make higher lows, you can see that I’ve drawn a minor ascending pitchfork, the rate has failed to retest this level, signalling that the bulls are very strong on the short term. We had a very strong confluence area formed at the intersection between the median line (ML) and the lower median line (lml) of the ascending pitchfork, but the rate has failed to touch this major support area.
The next upside target is at the upper median line (UML) of the descending pitchfork, could approach also the median line (ml) of the ascending pitchfork.