Overview:
The USD/CAD pair established the previous 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 1.2770.
The USD/CAD bulls have been defending the recent INTRADAY SUPPORT around 1.2300 (broken 79.6% Fibonacci Level). Hence, a new bullish swing was established without further retesting of the DAILY SUPPORT zone depicted on the daily chart around 1.1950.
The market looked overbought since bulls have pushed further above the upper limit of both depicted bullish channels. Hence, the current bearish correction was anticipated in the previous articles.
The nearest SUPPORT level to meet the USD/CAD pair is located around 1.2300 (79.6% Fibonacci level). It has been defended by the bulls since a bullish breakout took place on January 21.
DAILY closure again below the price level of 1.2300 exposes the next DAILY SUPPORT around 1.2000 where the backside of the upper limit of the breached channel is located.
On the other hand, the bullish persistence above 1.2300 (79.6% Fibonacci level) enhances further bullish advancement towards 1.2760-1.2780 (low probability).
Trading recommendations:
Wait for DAILY closure below 1.2300 for SHORTING the USD/CAD pair. TP levels should be set at 1.2250 and 1.2170. Stop Loss should be set as DAILY closure again above the ENTRY levels (1.2300).
