USD/CAD technical analysis: Struggling to gather upside traction despite flag breakout

• USD/CAD is struggling to find bids despite a flag breakout on the 4-hour chart.  
• The break above 1.3337 is needed to revive the bullish view put forward by the flag breakout.  

USD/CAD pair is currently trading at 1.3317, representing marginal losses on the day.

The pair jumped to a high of 1.3337 in the US trading hours on Tuesday, confirming a flag breakout on the 4-hour chart.  

A flag breakout, a bullish continuation pattern, had signaled a resumption of the rally from Oct. 2’s low of 1.3206 and opened the doors for 1.3470 (target as per the measured move method).  

So far, however, the flag breakout has failed to accelerate the preceding bullish move. In fact, the pair has fallen back to the former resistance-turned-support of the upper edge of the flag, currently at 1.3316.  

Looking forward, the flag breakout would gain credence if the pair rises above 1.3337. The outlook would turn bearish if the pair drops below 1.3287, invalidating bullish higher lows pattern.  

4-hour chart

Trend: Bullish above 1.3337

Technical levels