USD/CAD H&S Failure?
USD/CAD
-0.41%
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With oil and risk assets coming under pressure today, the Canadian dollar has sold off, while the US dollar has risen across the board after its recent weakness.
As a result, the USD/CAD is on the rise and it may go on to invalidate the head and shoulders pattern that it had created a few days ago.
If we climb and hold above the neckline area above 1.3500 area then this will put the bears in a spot of bother. We could then see a sharp rally towards levels where the bulls’ stops might be resting.
USD/CAD Chart
If it plays out how I have described it above, then the first target would be around 1.3682, the base of the break down around the right shoulder area. Thereafter we might see a potential move above 1.3810 where the trapped short stops would be resting, and potentially even 1.40 – above the head of the H&S pattern.
