Overview:
During the past few weeks, the USD/CAD pair established a temporary consolidation zone between the price levels of 1.1560 and 1.1670. This price zone roughly corresponds to 61.8% prominent WEEKLY Fibonacci level bullish breakout above which allowed bulls to reach the price levels of 1.1850, 1.1950 and recently 1.2055 where a new high has been established.
The nearest H4 support that is the price zone of 1.1800-1.1750 provided excellent SUPPORT for the pair on Thursday. LONG positions were suggested at retesting.
Note the newly established short-term channel being expressed since the price level of 1.1750 reaching up to 1.2050 as the market looks quite overbought since bulls have pushed further above the upper limit of the long-term movement channel. Hence, bulls should be conservative with their targets.
This minor channel pattern may indicate bearish reversal, if confirmed, with H4 bearish breakdown of the lower limit and the recent support around the levels of 1.1870-1.1900.
Otherwise, if bulls keep defending the recent INTRADAY SUPPORT around 1.1920 down to 1.1850, the market bias will remain positive targeting at 1.2090 and 1.2130 shortly after.
Trading recommendations:
Risky traders can wait either for a bullish spike towards 1.2090-1.2100, or for the H4 bearish breakdown below 1.1850 to SELL the pair aiming for 1.1750 and 1.1700.
You should be conservative with your Stop Loss / Targets of such a counter-trend trade.
