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Fan Yang

USD/CAD - Bearish Breakout from Rising Channel

Last time we looked at $USDCAD, we saw that it was in a rising channel, but this channel was coming up against a key resistance around 1.26.

USD/CAD 4H Chart

(click to enlarge)

- The 4H chart shows USD/CAD breaking below a persistent rising channel.
- The bullish trend since early September has definitely shifted.
- Now, there is bearish bias. 
- If price rallies but fails to push above 1.2550, we would have more confirmation for the bearish outlook.
- I noted support around 1.24 last time.
- If price slides below that, we can still target the 1.22-1.2250 ie. 1.2225 area without expecting a bearish continuation. 
- In other words we can start anticipating a medium-term sideways market, and still anticipate a short-term bearish market. 
- On the other hand, inability to push below 1.24 with ability to push back above 1.2550 would tell us that bulls are still in charge .