17 Feb 2016



The rate is currently testing the 4-month lows at 1.9780. Technically it has broken the large symmetrical triangle/tripple top support, but a break below 1.9770 is needed to confirm the break otherwise it may turn out to be a larger bullish flag pattern.

As all of the CAD pairs the next move will depend on what's going on with the Oil price as it may be also working towards a major reversal.

Another important thing that isn't encouraging for the the downside is the 2-and-a-half-year rising trendline support coming in at around 1.9500-1.9600 area which is also the former major resistance level/ new support so the propper strategy may be a smaller short entry on the Daily close below 1.9770 and then waiting as the rate breaks the trendline and tests it as the new resistance to enter with a full position.

The triangle breakout targets are 1.9150 and 1.8700, but a break back in the consolidation pattern above 2.0000 would invalidate my immediate bearish outlook.

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