Overview:
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 it allowed bulls to reach new highs around 1.2560.
The market looks quite overbought since bulls have pushed further above the upper limit of the depicted bullish channels. Hence, high probability of bearish reversal exists.
The bearish reversal scenario indicated after the Hanging Man daily candlestick was invalidated with yesterday's bullish engulfing daily candlestick.
Moreover, USD/CAD bulls kept defending the recent INTRADAY SUPPORT around 1.2300. Hence, a new bullish swing is being established without further retesting of 1.1950.
The nearest resistance zone to meet the USD/CAD pair is located around 1.2800 where previous WEEKLY highs were previously established back in 2009.
Trading recommendations:
It's recommended to stay out of the market until the next destination of the USD/CAD pair becomes obvious, but at anyway try to look for SELL entries at such historically high prices.
