USD/CAD dropped, but the current decline could only be corrective in nature. When USD/CAD will confirm a larger downside movement? A new higher high could change the sentiment and could announce an upside continuation. The USD/CAD price plunged after failing to close around 1.2589 today’s high. It has dropped as the DXY has shown some overbought signs. Technically, USD/CAD is still under pressure. It was expected to drop after the most recent rebound. –Are you interested to learn more about forex signals? Check our detailed guide- Still, it remains to see what will happen as the pair is located above some strong support levels. I believe that the US inflation data will be decisive tomorrow. The volatility will be high around this high-impact event. The Dollar Index is located at resistance, so a potential drop forces the dollar to lose ground versus the Loonie. On the other hand, DXY’s growth could help the greenback to dominate the currency market. Of course, anything could happen in the coming hours, so you’ll have to be careful. The Core Price Index, CPI, is expected to increase by 0.5% in July, while the Core CPI may increase by 0.4% versus 0.9% in the previous reporting period. The US economic data will drive the pair during the week. As a result, the USD/CAD pair is vulnerable to drop deeper, but we still need confirmation because DXY’s breakout above 93.19 high may signal USD’s appreciation. Get FREE Forex Signals Now! USD/CAD price technical analysis: Key levels to watch USD/CAD 4-hour price chart The USD/CAD price dropped after failing to reach and retest the uptrend line in the last attempt. Also, it has failed to reach the 1.2605 weekly R1, so its current decline towards the weekly pivot point (1.2529) is natural. –Are you interested to learn more about automated forex trading? Check our detailed guide- Staying above the pivot point and above the upper median line (UML) may signal that USD/CAD could still increase. However, technically, I believe that only dropping and stabilizing below the 1.2476 S1 could really announce a deeper decline and could invalidate an upside continuation. The uptrend line retest, the false breakout, signaled that USD/CAD pair could come back down, but the breakout through the upper median line (UML) signaled strong buyers. After the current retest, a new higher high could signal more gains and bring new opportunities to go long. Looking to trade forex now? Invest at eToro! Trade Forex Now! 67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money. Saqib Iqbal Saqib Iqbal Saqib Iqbal is a market analyst, prop fund trader and mentor, serving the industry with his analysis and educational content since 2011. The author has great exposure to different financial markets and institutions. He's well-known for his day trading reviews and multiple timeframe analysis. View All Post By Saqib Iqbal Majors share Read Next EUR/USD Price Defends 1.1700 Despite Stong USD Ahead of US CPI Saqib Iqbal 1 year USD/CAD dropped, but the current decline could only be corrective in nature. When USD/CAD will confirm a larger downside movement? A new higher high could change the sentiment and could announce an upside continuation. The USD/CAD price plunged after failing to close around 1.2589 today’s high. It has dropped as the DXY has shown some overbought signs. Technically, USD/CAD is still under pressure. It was expected to drop after the most recent rebound. –Are you interested to learn more about forex signals? Check our detailed guide- Still, it remains to see what will happen as the pair is located above some… Regulated Forex Brokers All Brokers Sponsored Brokers Broker Benefits Min Deposit Score Visit Broker 1 $100T&Cs Apply 0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 9.8 Visit Site FreeBets Reviews$100Your capital is at risk. 2 T&Cs Apply 9.8 Visit Site FreeBets Reviews$100Your capital is at risk. 3 Recommended Broker $100T&Cs Apply No deposit or withdrawal feesTrade major forex pairs such as EUR/USD with leverage up to 30:1 and tight spreads of 0.9 pips Low $100 minimum deposit to open a trading account 9 Visit Site FreeBets ReviewsYour capital is at risk. 4 T&Cs Apply Visit Site FreeBets ReviewsYour capital is at risk. 5 Recommended Broker $0T&Cs Apply Trade gold, silver, and platinum directly against major currenciesUp to 1:500 leverage for forex trading24/5 customer service by phone and email 9 Visit Site FreeBets ReviewsYour capital is at risk.