FX.co ★ USD/CAD Bullish Setup Grows

USD has taken the lead again in the short term after USDX's rebound. USD/CAD is trading lower at 1.3207 versus 1.3247 today's high. Still, the current losses could be erased during the day if the US data comes in line with expectations or better.

Today's rally signaled that the pair is expected to reach fresh new highs soon. Technically, the pair has escaped from a descending channel signaling an up reversal. A brand new higher high could bring a short-term long opportunity.

USD/CAD failure to stabilize below the Pivot Point (1.3161) followed by a strong bullish momentum signals more gains. The aggressive breakout above the former highs strong buyers as well.

The pair has rallied after escaping from the down channel, it has decreased to test and retest the 23.6% retracement level, and now it seems determined to resume its leg higher. A bullish closure above the 38.2% (1.3268) and R1 (1.3271) levels confirms the bullish scenario.

• USD/CAD Trading Tips & Conclusion

A valid breakout above the 38.2% and R1 levels bring a buying opportunity with a potential target at the median line (ML), right above the R2 (1.3370) level.

A selling signal could be activated by another lower low, drop below 1.3127 yesterday's low. The major downside target, support, stands at the lower median line (LML).