USD/CAD drops again as the minor rebound has ended, the pair could hit fresh new lows soon if the USDX will continue to drop. The pair is expected to resume its downtrend after several failures to stabilize above the downtrend line.
Another lower low will really confirm a further drop and will bring another selling opportunity. USD/CAD is located deep in the seller's territory, so we cannot talk about a potential leg higher as long as the price action suggests downside.
USD/CAD has failed to test and retest the downtrend line and the lower median line (LML) signaling high bearish pressure. Though, as I've just said higher, only another lower low, drop below 1.3192 will really suggest selling.
The S1 (1.3173) is seen as the first downside target, a valid breakdown through this level will suggest selling as well. The price has failed to make another higher high or to print a reversal pattern, that's why the perspective remains bearish.
USD/CAD Trading TipsSell a drop below S1 (1.3173), the next downside targets are represented by S2 (1.3081), and by S3 (1.2969) levels.
Buy only a rebound followed by a valid breakout above the 1.3356 level. This scenario could take shape if the USDX will develop another leg higher.