Overview:
Since bulls pushed the price further above the upper limit of both depicted bullish channels and the 79.6% Fibonacci level, the market looked quite overbought.
The market failed to hold above 1.2650 - 1.2680 (previous highs) resulting in the formation of a Triple-top pattern.
Successive lower highs were established within the depicted consolidation zone, supporting the bearish side of the market.
Moreover, support levels around 1.2350 and 1.2300 (79.6% Fibonacci level) were broken after providing significant support for several weeks on the daily and weekly charts.
A daily fixation below 1.2300 clears the way for the USD/CAD pair towards the zone between 1.2000-1.1950 (where the projection target of the recent range breakout is located) and 1.1800 where the depicted daily uptrend is roughly located.
The price zone at 1.2320-1.2350 remains a significant intraday resistance zone where the price actions should be watched for a low-risk sell entry at further retesting.
Trading recommendations:
Conservative traders should be waiting for either a bullish pullback towards 1.2320-1.2350 or a bearish breakout below 1.2100 for a valid sell entry.
T/P levels should be placed at 1.2220, 1.2150 and 1.2050, respectively.
On the other hand, daily closure above 1.2370 invalidates this bearish scenario.
