The USD/CAD 38.2% Fibonacci retracement level calculated from 1.3095 to 1.3901 and located at 1.3593, is anticipated to serve as a robust support for the market. This level is expected to curb further downside movements and potentially catalyze a rebound. A move above the minor resistance of 1.3715 would shift the market bias back towards an upward trajectory, aiming to retest the 1.3901 level. However, if the market experiences a sustained breach below 1.3593, it would suggest the commencement of a more profound correction phase, potentially targeting the 61.8% retracement level at 1.3403.
Expanding the scope to a broader timeframe, the corrective pattern observed from the 2022 high of 1.3980, which involved a three-wave decline to 1.3095, is likely concluded. A decisive break above the 1.3980 threshold would confirm the resumption of the upward trend that began at the 2021 low of 1.2009. The next significant target is projected at the 61.8% Fibonacci extension of the 1.2405 to 1.3980 range from 1.3095, situated at 1.4068. This bullish scenario is favored if the support at 1.3382 is maintained.
Analysis Summary
The market analysis suggests a strong support level at 1.3593, with the potential for an upward shift on breaking above 1.3715. A sustained drop below 1.3593, however, indicates a deeper correction. The long-term view remains bullish, with a resumption of the uptrend expected upon surpassing 1.3980.
Key Points
- 1.3593 is a crucial support level.
- Potential upside shift above 1.3715.
- Longer-term bullish outlook above 1.3980.
