USDCAD Price Analysis: Bulls are hanging on by a thread above 1.3300

USDCAD bulls remain in play but there are risks of a break below 1.3300.
Bulls need to clear 1.3380 for the prospects fo a firmer run to 1.3550.

Ross J Burland FXStreet

As per the prior day's bullish thesis, USDCAD Price Analysis: Bulls moving in and eye a 38.2% Fibo, the price indeed moved in on the targetted area. However, the bears were quick to pounce on the rally and we are back to square one as the following illustrates:

it was explained that the Bank of Canada next meets on December 7 and a 25 bp hike to 4.0% is expected and that there is a long time between now and then that gave rise to prospects of a meanwhile correction as follows:

USDCAD weekly chart

The M-Formation was a compelling bullish feature, but it was also explained that there could still be some downside to come:

A break of the support was eyed as a catalyst that would open up the way to dynamic trendline support.

However, the bulls were firming and the 38.2% Fibonacci was eyed for the remainder of the week:

USDCAD update

We have seen that move already. Until a break of 1.33 the figure, the emphasis remains on the upside as per the hourly chart:

The M-formation is a reversion pattern and so long as the bulls can get above 1.3380 and then 1.3420, there will be prospects of a move into the price imbalance and 1.3550 will be vulnerable.

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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