Обзор и динамика
Despite the breakdown (amid the positive data on the labor market in the US in July) of the strong resistance level 1.3100 (Fibonacci level 38.2% of correction to the growth of the pair from the beginning of July 2014 and the level 1.0650, EMA200, EMA144 on the daily chart) in the beginning of August, USD/CAD pair was not able to develop an ascending movement.

The narrowing ascending triangle, which can be viewed as a bull model though, did not form a reversal figure for the downtrend of USD/CAD pair.

After the consolidation of the pair from early May as part of a narrowing triangle last week, it broke down the lower limit of the triangle near the level 1.3000.

USD/CAD pair almost reached the support level 1.2740 (the lower limit of the rising channel on the daily and weekly charts).

Today, the US dollar is recovering on the currency market, including in USD/CAD pair.

Our opinion
OsMA and Stochastic indicators on the daily and weekly charts are on the side of the sellers. However, on the 1-hour and 4-hour charts they reversed to long positions. The upward correction may continue to the level of 1.2890 (EMA144 and the upper limit of the descending channel on the 1-hour chart). Stronger growth within the upward correction is possible to the level 1.2990 (EMA200, EMA144, the upper limit of the descending channel on the 4-hour chart).

Returning to the scenario of strengthening of USD/CAD pair in the medium term will be possible after consolidation above the resistance level 1.3100 with a probability of further growth of the pair to levels 1.3300, 1.3680 (Fibonacci level 23.6%).

Breakdown of the support level 1.2740 could signal a resumption of the downtrend for USD/CAD pair with immediate targets at 1.2635 (Fibonacci level 50.0%), 1.2525 (year’s lows).

Support levels: 1.2740, 1.2635, 1.2525
Resistance levels: 1.2890, 1.2990, 1.3050, 1.3100, 1.3185, 1.3200, 1.3300

Trading recommendations
Buy according to the market. Stop-Loss 1.2780. Take-Profit 1.2890, 1.2990, 1.3050, 1.3100 
Sell Stop 1.2770. Stop-Loss 1.2810. Take-Profit 1.2740, 1.2635, 1.2525

The indicatorsare on the side of the buyers
The indicatorsare on the side of the buyers

Breakdown of the lower limit of the triangle
Breakdown of the lower limit of the triangle

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