4-hr USD/CAD: A 200-pip Drop Anticipated
After a massive 1,000-pip rally since October, USD/CAD is showing signs of momentum exhaustion. A solid resistance has formed at 1.4450, suggesting early buyers are now likely taking profits. Major indices are stabilizing, and commodities are recovering—signals that the USD may weaken.
The immediate support at 1.4336, coinciding with the 23% Fibonacci retracement, has been tested several times but now appears unlikely to hold. If this level breaks, the next support is expected at 1.4190, aligning with the critical 50% Fibonacci retracement. This area, previously a resistance, seems like a logical target for sellers.
Traders looking to capitalize on a potential drop in USD/CAD might wait for a confirmed break of the immediate support before entering short positions. With broader market conditions hinting at a USD decline, the pair may be poised for a pullback if sellers gain control.
The immediate support at 1.4336, coinciding with the 23% Fibonacci retracement, has been tested several times but now appears unlikely to hold. If this level breaks, the next support is expected at 1.4190, aligning with the critical 50% Fibonacci retracement. This area, previously a resistance, seems like a logical target for sellers.
Traders looking to capitalize on a potential drop in USD/CAD might wait for a confirmed break of the immediate support before entering short positions. With broader market conditions hinting at a USD decline, the pair may be poised for a pullback if sellers gain control.
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