The chart shows that the USD/CAD bulls failed to show enough momentum above 1.1200 during the last visit on March 20. The bears took an advantage and pushed the pair towards the price zone of 1.0910-1.0850 (50-61.8% Fibonacci levels on the daily chart).
Although previous daily closure below 1.0920 took place, it didn't take long time to get a bullish engulfing daily candlestick as a bullish reaction the next day pushed the pair again towards 1.1000.
On the other hand, on the 4H chart, the price zone of 1.0995-1.1045 (38.2% Fibonacci of the most recent bearish swing) was expected to provide a valid sell entry and it did.
The previously suggested bearish position taken at 1.0995 achieved its full projection target by hitting 61.8% Fibonacci level around 1.0830.
As expected, price zone of 1.0875-1.0830 (extending down to 61.8% Fibonacci level on the daily chart ) provided significant bullish pressure strong enough to invalidate our SELL position. The market is now expressing a bullish pull-back towards 1.0940-1.0950 and probably 1.0980 where 38.2% Fibonacci level is located on the 4H chart.
Bearish positions can be taken again at the price zone of 1.0940-1.0950. It's the most recent resistance zone that comes to meet the pair. The pair will probably establish a sideway consolidation zone. Bearish targets are to be located at 1.0865 initially. SL should be located slightly above 1.1000.
The material has been provided by InstaForex Company - www.instaforex.com
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