Daily Pivots: (S1) 1.0790; (P) 1.0890; (R1) 1.0950
USD/CAD’s pull back from 1.0991 extends further and the break of 1.0859 indicates that an intraday top is in place. Some consolidation should now be seen. But downside is expected to be contained above 1.0659 support and bring rally resumption. As discussed before, a short term bottom should at least be in place at 1.0590. Above 1.0991 will target 1.1101 resistance to confirm a medium term bottom is in place too. However, break of 1.0659 will dampen this view an turn focus back to 1.0590 low.
In the bigger picture, fall from 1.3063 is treated as correction to the five wave rally from 0.9056 (07 low). Such decline is possibly completed at 1.0590 on bullish convergence conditions in daily MACD, after missing 61.8% retracement of 0.9056 to 1.3063 at 1.0587. Break of 1.1101 resistance will add much credence to this case and turn focus to 1.1723 resistance for confirmation USD/CAD has bottomed out in medium term. On the downside, while another fall cannot be ruled out for the moment, we’d continue to look for reversal signal as correction from 1.3063 is expected to conclude inside 1.0297/0819 support zone.