USDCAD was in the downtrend for the last 30 days and it has reached a second support level. USD currency is under pressure which is visible with large bearish candles in the last few days.
Price is currently at the 1.24967 support level which is also a confluence of support. We have an uptrend channel with a horizontal support level which makes this level significant for the bulls.
This level has history meaning when the price was in the bearish mode and that was last time in September 2021, the price found support at this level and then pushed upwards to higher levels.
The price formed a bullish Pin bar on the confluence of support which is one more signal for the bulls.
A USDCAD pair with three bullish signals has a high chance to change bias into bullish in the next few days. What is visible on the chart compared with previous similar scenarios is that the price could move a little bit down and reach 1.24400 level and then find more strength to move upwards.
This level was the bottom point several times in the past when the price was going down and then changed direction.
Currency strength meter shows similar scenario where USD is stronger than CAD currency which gives more confirmation into bullish scenario.
Entry level is at 1.24690 which can be variable and up to 1.24400 with stop loss below previous lows. And that is below another support level at 1.23960 which had an impact as resistance in the past for the bulls and support for bears.
First target level is set above the first resistance level, but which has more impact as a support when the price is moving down than now when the price is moving upwards. That means the price should not have too many problems breaking through that level.
Second profit target is above 1.27500 which is resistance for the price in the bullish mode. If we take a look in the past bullish moves had resistance at this level so we can expect the same case.
If the price reaches the first profit target it is a smart move to lock the profits to break even.
If the current prediction realizes that it will be Risk:Reward = 2.8 which is great.
<<<<<<< HEAD Frano is an engineer, author, forex trader and the owner of a blog where he teaches forex trading for beginners. Frano created GetKnowTrading website to share his knowledge, market analysis ======= Frano is an engineer, author, forex trader and the owner of a blog where he teaches forex courses for beginners. Frano created a website on how to trade forex to share his knowledge, market analysis >>>>>>> Userlogincount210522 which is also published on forexFactory.com, investing.com and many other trading related websites.