USD / CAD has conformed to medium-term bearish bias
- USD / CAD bears are testing critical support territory
- On a break in the head and shoulders, the downside is to play everything.
Based on the previous analysis, USD / CAD is shaping up to be medium term play after a classic visit and retest of previous highs reinforcing a bearish bias as follows:
USD / CAD daily chart, prior analysis
As pictured above, the head and shoulders were in the making …
In the previous sessions, the price eased the price imbalance and thereafter the bears moved and pushed the price towards daily support. This gives a compelling scenario.
USD / CAD H4 Chart
With a downward bias below the countertrend line, we have a bearish structure. above local support. The price is expected to move into the 1.27 area before a massive sell off.
USD / CAD H1 Chart
From a shorter term perspective, the 61.8% Fibo on hourly char lines up with an earlier structure which may well pull price ahead of a downward correction. The bearish scenario also rhymes with positioning as the net CAD positions of net speculators remain in positive territory for several consecutive weeks after the hawkish tone of the BoC.