The USD/CAD pair drops on the H4 chart. It's trading at 1.2823 at the time of writing and it seems heavy in the short term as the Dollar Index slipped lower. Technically, the pair reached a dynamic upside obstacle, so a temporary drop is natural.
The pair remains bullish despite temporary drops. USD/CAD drops as the USD was punished by the US Advance GDP indicator which reported a 1.4% drop in Q1 versus a 1.1% growth expected. The Advance GDP Price Index rose by 8.0% versus 7.2% estimates, but unfortunately, the Unemployment Claims came in at 180K versus 178K expected.
USD/CAD Exhausted Buyers!
The USD/CAD pair reached the ascending pitchfork's upper median line (uml) which represents a dynamic resistance. The weekly R1 (1.2800) and the 1.2777 are seen as immediate downside obstacles.
The median line (ml) of the ascending pitchfork stands as a dynamic support. As long as it stays above it, the USD/CAD could still grow. After failing to reach the 1.2901 major target, the price could still try to hit it after ending its current drop.
USD/CAD Forecast!
Testing and retesting the 1.2777 or the median line (ml) could bring new long opportunities. 1.2901 is seen as a strong upside obstacle. It could approach and reach it as long as it stays above the median line (ml).
A larger upwards growth could be confirmed by a valid breakout above the 1.2901 key level. This could bring long opportunities as well.
