In a previous analysis we warned bears of a bullish divergence in the RSI and that price was more probable to make a move higher towards 1.33-1.3350 rather than fall lower. Price was expected to bounce towards resistance trend line.
Red line -major resistance trend line
Blue lines - bullish divergence signs
USDCAD is trading at 1.3320 area very close to the major downward sloping resistance trend line. Now is a good opportunity for bears to step back in. In case of a rejection, then we should expect price to make a lower low towards 1.3070-1.3050. Resistance remains important at 1.3330-1.3350 and as long as price is below it, we remain bearish. In case price breaks above 1.3350 we should then expect price to challenge the recent highs at 1.3415 and most probably break it. However until then traders need to be patient. Now bears remain in control of the trend.
