USDCAD is trading at 1.2550 and is moving lower as expected after breaking out and below the wedge pattern formation. Our short-term target is at 1.25 and we are very close to reaching this target. The upward move from 1.2375 to 1.2635 is finished and we are now in a corrective phase.
Red rectangle- target
Black lines - Fibonacci levels
USDCAD has started making lower lows and lower highs. Having broken below 1.26 we have a bearish signal pointing to a pull back towards the red rectangle shown above in the 1 hour chart. Bulls want price to continue lower and form a higher low relative to 1.2375 in order to gather momentum for the next leg higher. Bears on the other hand do not want to see price break above 1.2635. They want to see price continue making lower lows and lower highs and eventually break 1.2375.
