USD/CAD Mid-Day Outlook

Daily Pivots: (S1) 1.3291; (P) 1.3315; (R1) 1.3345; More…

USD/CAD dipped briefly to 1.3262 but quickly resumed recent rise to 1.3318. Further rise is expected to 100% projection of 1.2246 to 1.3124 from 1.2526 at 1.3404 next. Nonetheless, break of 1.3262 will indicate short term topping. In that case, intraday bias will be turned to the downside for pull back to 4 hour 55 EMA (now at 1.3187) or below. But we’d expect strong support above 1.2948 to bring rally resumption.

In the bigger picture, current development solidify the view of bullish trend reversal. That is fall from 1.4689 (2015 high) has completed at 1.2061, ahead of 50% retracement of 0.9406 (2011 low) to 1.4689 (2015 high) at 1.2048. Further rally should be seen for 61.8% retracement of 1.4689 to 1.2061 at 1.3685 and above. This will now be the preferred case as long as 1.2526 support holds, even in case of deep pull back.