Inverted Head and Shoulder on USDCAD Indicates Further Gains Towards 1.51/1.53
Mar 26 2020
USDCAD made an inverse head and shoulder formation from 2015 high, a powerful pattern, which can signal a new bullish recovery. We see a completed pattern at the 1.2955 level, from where bullish movement took over. The price also breached above the 1.3666 level, where a trend line is located, also known as a neckline. This breach is a confirmation that a bullish reversal is in full motion and can take price towards the price target at the 1.51/1.53 in weeks or months ahead
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H&S pattern can sometimes go perfectly with Elliott Wave cycles. Well, on the 4h chart of USDCAD we see higher highs and higher swing lows with an extended structure in the middle so looks like an impulse is underway, ideally above 2016 high. If that’s the case that continuation of an uptrend can be coming soon as current reversal lower can wave four correction. Nice support comes in around 1.4 psychological level. If price can rally from here and break upper corrective channel line then watch out for 1.5 with upcoming fifth wave.
Also, when trading Lonnie watch crude oil prices as well. These are still in downtrend so CAD remains under pressure, but more about this one in one of our next articles.
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