The USD/CAD pair edges lower today, around mid-1.3500s, as the loonie broke yesterday below the potential early June uptrend to reinforce the view of a bear ‘wedge’ continuation pattern, which would be confirmed below 1.3492/86, the Credit Suisse analyst team reports.
“USD/CAD saw the expected collapse, breaking below the potential uptrend from early June and reinforcing the potential for a bear ‘wedge’ continuation pattern.”
“We expect further weakness to unfold, also in line with the existing large bearish ‘descending triangle’ continuation pattern. With this in mind, we see support initially at 1.3552, then 1.3528, ahead of a fall back to the pivotal 200-day average and June low at 1.3492/86. Removal of here in due course would then trigger the pattern to suggest the core bear trend is resuming, with support seen thereafter at 1.3452.
“Resistance is initially seen at the aforementioned early June potential uptrend at 1.3593, which also ideally caps to keep the immediate downside bias intact. Above here would suggest a deeper correction higher with resistances seen next at 1.3628 and 1.3648.”