In our last analysis in USDCAD we warned bears that despite the new lower lows and lower highs they should be very cautious. All signs of a possible upside reversal were there. Price is now breaking above and out of the downward sloping wedge pattern.
Blue lines - bullish divergence
USDCAD is breaking to new short-term higher highs. Price has broken the bullish wedge pattern and is now trading above short-term resistance. The RSI was giving a bullish divergence and it warned bears the last couple of weeks that the downside momentum was weakening. We expect the upside bounce to continue towards 1.29-1.30 area.
