USD/CAD Price Analysis: Bears move in and eye a break of critical support

USD/CAD bulls look to the 50% mean reversion target of the bearish impulse.
Bears eye supports below 1.3300, targeting 1.3250/20 and then 1.3200 / 1.3150.

Ross J Burland FXStreet

USD/CAD has blown off on Tuesday as preliminary domestic data showed the economy growing at a slightly faster pace than the Bank of Canada expected in the fourth quarter. This brings us to the Federal Reserve meeting on Wednesday with the technicals well entrenched for a breakout to the downside if the market gets what it's looking for from the meeting.

The following illustrates a bearish outlook for the short term to 1.3150 based on the daily and 4-hour charts:

USD/CAD daily charts

Zoomed in ...

USD/CAD has started to make its way to the bull cycle's supportive trendline by breaking down structures along the way.

It failed to stay above the near-term bearish dynamic resistance as illustrated above which keeps the focus on the downside, for now.

USD/CAD H4 charts

The price could stall here and correct towards the 50% mean reversion of the bearish impulse before meeting resistance again and dropping into test the supports below 1.3300, targetting 1.3250/20 and then 1.3200 / 1.3150.

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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