USDCAD has been trapped inside a downward sloping wedge pattern since August of 2020. Price continues making lower lows and lower highs. Trend remains bearish. Price is now challenging the upper wedge boundaries and if price breaks above 1.2650 we could see a much bigger bounce towards 1.30-1.32.
Red line – upper wedge boundary
Blue line – lower wedge boundary
USDCAD is trading just above 1.26 right now. Price reached our pull back target of 1.25 and made a higher low. This was ideal for bulls. If price breaks above the red downward sloping resistance now, bulls will have a great setup for a move towards 1.30-1.32 where we find the start of this wedge pattern. Support is at 1.25-1.2480. This could be used as a stop for any long position. A break below this level will open the way for a move towards 1.23-1.22.