USDCAD started a bullish correction after showing good signs of bearish resumption. There is a high likelihood that price will resume downside after the correction has completed. The following analyses the Loonie and looks at the next level to look out for bearish continuation based on 18 April USDCAD daily Elliott wave analysis.
18 April, AtoZForex - USDCAD has been one of the biggest currency movers as prices of Oil rallied above $50. The Loonie has been exhibiting clear Elliott wave structures for a very long time. In the last update, we speculated a good bearish move after price completed a corrective pattern upside. Price did exactly as expected and held down. The dip quickly showed an impulse wave - a clear one. A corrective rally would definitely be expected after this, and that exactly is what is happening now. The chart below was used in the last update.
USDCAD Elliott wave analysis, H4 (click to zoom)
There is a clear sign of the bears dominating in the coming days. A break below 1.325 could lead price to 1.32 and 1.30. As Crude oil prices rise, USDCAD is bound to fall. A rally above 1.3469 will be required for the bullish trend to continue. This is less likely than a bearish move to 1.32 and 1.30.
The bears dominated and price stayed below 1.3469 barrier. It's very likely that the bearish trend will resume and set price below 1.30 as Oil prices are expected to rally even further to our target at $58-$60. Will there be another opportunity for sellers to look for bearish opportunity?. The chart below shows an updated wave count.
18 April USDCAD daily Elliott wave analysis: what next?
USDCAD Elliott wave analysis, H2 (click to zoom)
The chart above labels the decline from 1.345 as an impulse wave which ended above 1.32. The rally that followed is expected to be corrective. 1.337x has been marked as a price reversal region. If the rally does not take 1.345, there are good chances that price will resume bearish and break below 1.3. The bullish corrective pattern emerging is a zigzag pattern. Stay tuned for updates.
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