- USD/CAD bears are seeking an hourly downside extension.
- USD/CAD bulls are lurking at the daily support near 1.2750.
USD/CAD is attempting to break lower in US trade on Thursday. However, as illustrated in the following charting analysis, there are critical areas of resistance and support to keep in mind, as well as reversion patterns.
USD/CAD 1H chart
On the hourly chart, there is an M-formation that is playing out. The price would be expected to be hamstrung to the prior support being the neckline of the M-pattern. However, it is an overextended M-formation, so the reversion may only get as far as the last support near 1.2795.
The wicks of recent hourly candles within the bearish impulses have come close already. Therefore, an hourly close below 1.2770 could be seen to nullify the reversion pattern, and the focus will be on the downside. 1.2770 is a significant level as it is -61.8% of the length of the initial bullish leg of the M-formation.
USD/CAD daily chart
Meanwhile, from a longer-term perspective, the daily chart is showing that the price is running towards the neckline of the W-formation, as illustrated in the above chart. From there, should demand move in, then a bullish continuation could be on the cards for the foreseeable future.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds steady near 1.0400 in quiet trading
EUR/USD continues to fluctuate in a tight channel at around 1.0400 in the European session on Friday. The absence of fundamental drivers and thin trading conditions on the holiday-shortened week make it difficult for the pair to find direction.
GBP/USD declines toward 1.2500 as markets turn cautious
GBP/USD stays under modest bearish pressure and retreats toward 1.2500 on Friday after posting small losses on Thursday. The cautious market mood doesn't allow the pair to gain traction, while trading volumes remain low following the Christmas break.
Gold struggles to build on weekly gains, holds above $2,620
Gold enters a consolidation phase and trades below $2,630 on Friday after closing in positive territory on Thursday. The risk-averse market atmosphere helps XAU/USD limit its losses as investors refrain from taking large positions heading into the end of the holiday-shortened week.
Bitcoin misses Santa rally even as on-chain metrics show signs of price recovery
Bitcoin (BTC) price hovers around $97,000 on Friday, erasing most of the gains from earlier this week, as the largest cryptocurrency missed the so-called Santa Claus rally, the increase in prices prior to and immediately following Christmas Day.
2025 outlook: What is next for developed economies and currencies?
As the door closes in 2024, and while the year feels like it has passed in the blink of an eye, a lot has happened. If I had to summarise it all in four words, it would be: ‘a year of surprises’.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.