The USD/CAD is within a complex correction that should resolve to the upside and provide excellent trading opportunities. Today’s post will offer an updated wave analysis for this currency pair.
My previous USD/CAD analysis highlighted a potential leading diagonal scenario since the Sep 2017 low. The scenario remains on track so far. Price has created clear 3-wave swings in both directions while trading inside converging trend lines (black). We are most likely in the later stages of wave B (black) of 5 (white) at the moment, which is quite complex. Price has behaved in a corrective manner since the beginning of May and is probably tracing out a double three correction that could culminate as a triangle (green Y). The previous bearish swing during June 5-6 was a 3-wave structure, which gives further credence to a triangle formation.
The chart above shows my currently favored price path projection (white lines). There is also a possibility that all price-action since May 1 is part of one big triangle (i.e. no wxy double three), which would allow the price to drop somewhat deeper than what is shown in the above chart) but it should ideally still respect the main ascending support trendline (black) and certainly not drop below 1.2730.
In any case, the entire structure since Sep 2017 is most likely still missing an impulse to the upside, regardless of whether it is seen as a bullish leading diagonal or a bearish triple zigzag.
Lucrative buy opportunities will appear once we get more confirmation that a triangle is indeed forming. It should resolve to the upside and target levels of at least 1.3130 and could easily go as high as 1.3250, creating excellent reward to risk ratios.
Updates will be posted as and when more pattern validation emerges.
All the best along your trading journey.