20 July USDCAD Elliott wave analysis

USDCAD took a big leg upside yesterday as part of a bullish correction. What should we expect next? The following 20 July USDCAD Elliott wave analysis gives technical insights into USDCAD.

Dollar rallied swiftly yesterday before dropping fast. USDCAD rallied in the early hours of the London session yesterday to complete what could be the last leg of a bullish correction. We have noted that this month rally is corrective and it won’t be long before the bearish move gets back on track. In the last update, we had expected this to happen but price took more leg upside. The chart below was used in the last update.

Price was rejected at 1.3260-65 and dropped. There has been a rally following but that might not last long before the bears resume again. If the correction of the 1.3385 to 1.3060 decline has completed as shown above, we should see price breaking below the channel, down to 1.3060 and eventually 1.3. The long term bearish target still stays at 1.25. Unless a sudden break above the new top at 1.3260, this forecast should hold.

20 July USDCAD Elliott wave analysis: what next?

Price stayed above the resistance zone slightly to form a temporary top at 1.329. A much better double zigzag pattern has completed at the same price zone. If price stays below 1.329, we should expect a break below 1.323 to trigger a bearish move down to the base of the channel. If the channel is broken downside, a dip below 1.3060 should follow. The long term bearish target remains at 1.25. If price moves as expected, we will count a bearish impulse wave from 1.329 top. Stay tuned for the next update.

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