- USD/CAD bulls start to graze on bearish correction.
- The trend line support could hold and lead to a bullish continuation.
The Canadian dollar rose against the US dollar on Monday, as the agreement to temporarily suspend the US debt ceiling boosted investor sentiment. However, from a technical point of view, the correction could be taken advantage of by hungry bulls, as shown below.
USD/CAD daily chart
The market is carving out a W formation with prospects for a bullish continuation.
If we zoom in, we see that prices have rallied to new highs, only to correct the rally again at a 50% mean reversion. This could encourage the bulls to re-enter at a discount with price respecting trend line support.
4 hour chart
From a lower time frame perspective, the price will have to break above the recent highs. This will signal a new bullish structure for the bulls to lean into positioning for higher highs to come. On the other hand, a break of 1.3570-50 would be bearish.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
