USDCAD has broken out and above the bearish channel it’s been inside since early February. Price has been falling from the peak of 1.47 to 1.2450 low for several weeks. I believe that USDCAD has made an important low at 1.2450 and is showing bullish reversal signs.
Yesterday we saw price break above the bearish channel. Short-term trend is bullish and the medium-term bearish trend is being challenged. Stochastics are turning upwards from oversold levels and with weekly stochastic still in oversold levels, the upside is expected to run for several weeks with our first target being the 38% Fibonacci retracement of the entire decline.
In the weekly chart price has reached the lower Kumo (cloud) boundary and bounced upwards. A break above the upper cloud boundary will confirm the bullish reversal and will increase the chances of reaching our 1.33 target. I’m bullish USDCAD as long as we hold above 1.2450 targeting at least 1.33.