USD/CAD Mid-Day Outlook

Daily Pivots: (S1) 1.2922; (P) 1.2961; (R1) 1.3021; More…

USD/CAD’s rebound from 1.2886 short term bottom accelerates to as high as 1.3062 so far in early US session. Intraday bias remains on the upside for short term channel resistance (now at 1.3116). Note again that the pair is staying in near term falling channel, and thus, there is no indication of bullish reversal yet. On the downside, below 1.2997 minor support will turn bias back to the downside for 1.2879 fibonacci level. However, sustained break the of the channel resistance will be the first sign of bullish reversal and bring stronger rise to 1.3173 resistance for confirmation.

In the bigger picture, the break of channel support (now at 1.2988), argues that rise from 1.2246, as well as that from 1.2061, has completed at 1.3385. Focus is back on 38.2% retracement of 1.2061 to 1.3385 at 1.2879. Decisive break there will affirm the case of medium term reversal and target 61.8% retracement at 1.2567 and below. That will also put key long term support at 50% retracement of 0.9406 (2011 low) to 1.4689 (2015 high) at 1.2048 into focus. On the upside, break of 1.3173 resistance will revive the bullish case and target 61.8% retracement of 1.4689 to 1.2061 at 1.3685 and above.