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USD/CAD: Temporary Bearish Turn

Published 01/25/2016, 03:28 AM
Updated 07/09/2023, 06:31 AM

USD/CAD reached new highs around 1.4700 last week where bears stepped in and caused a strong bearish turn. Notice that move was sharp and it also extended much lower on Friday, which is important evidence for a top in place as there was a bearish weekly candlestick formation. But it can only be a temporary top if we consider that the decline can unfold only in three legs, that would then represent a wave four. However, no matter where the pair is headed long-term, for the short-term swings there is room for more downside in sessions and days ahead. Notice that the current leg down is wave A, so there will be more weakness to come after the wave B rally.

USD/CAD 4-Hour Chart

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