USD/CAD Price Analysis: Bulls are grazing on the bearish correction
- USD/CAD bulls are starting to graze on the bearish correction.
- Trendline support could well be respected leading to a bullish continuation.
The Canadian dollar edged higher against the US Dollar on Monday as a deal to temporarily suspend the US debt ceiling boosted investor sentiment. Technically, however, the correction could be grazed upon by hungry bulls as the following will illustrate.
USD/CAD daily charts
The market is carving out a W-formation and with prospects of an upside continuation.
Zooming in, we can see that the price has rallied to make new highs only to correct back into the rally ina 50% mean reversion. This could encourage the bulls to reengage at a discount with the price respecting the trendline support.
USD/CAD H4 charts
From a lower time frame perspective, the price will need to clear the recent highs. This will mark a new bullish structure for the bulls to lean against in positioning for higher highs to come. On the other hand, a break of 1.3570-50 would be a bearish development.