USDCAD for a week has been recovering from a sell-out that started in the end of last month. As you can see in the following H4 chart, after defeating resistance at 1.2235, price reached the next defence area of 1.2360.
The mentioned area coincides with 50% correction of the last bearish impulse which gives it an additional confluence factor. Thus, the apparent reaction of sellers to this level was highly likely.
We are currently expecting further declines, first to broken resistance at 1.2235 (now support) and then to the diagonal support line at the bottom of the correction. Overcoming these levels would mean continuation of the bearish trend. Alternatively, if the demand obtains control on these support levels, it is important to expect that the price may continue to correct.
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