USD/CAD dropped aggressively in the short term as the US Dollar Index has decreased since Friday. Still, the pair could end its decline and it could start increasing again. Technically, USD/CAD was expected to develop a larger upwards movement after breaking above the downtrend line.
The upside scenario is still valid as long as the price is traded above the 1.2646, 1.2623, and 1.2612 former lows. So, the pair is traded above a strong support area, the price was rejected from this high demand area in the past.
Trading Conclusion!
USD/CAD could increase again from the mentioned support area. We may have a buying opportunity if the rate comes back above 1.2700 psychological level. Personally, I believe that only a drop under 1.2612 lower low could invalidate another increase, swing higher.
The 1.2800 and 1.2900 psychological levels could be used as the next upside targets if USD/CAD will increase again.
