By: Dima Chernovolov
USD/CAD continues to fall inside the clear daily Down Channel chart pattern which was recently identified by Autochartist. Autochartist rates the quality of this Down Channel at the 4-bar level – which is the result of the slow Initial Trend (one bar), above-average Uniformity (6 bars) and higher Clarity (7 bars). USD/CAD is expected to fall further inside this Down Channel – in line with the earlier breakout of the strong support area shown below.
As can be seen from the daily USD/CAD chart below, the price earlier broke through the support area lying between the support level 1.2380 (which reversed the price earlier this month) and 61.8% Fibonacci correction of the previous long-term ABC correction from September. This price area is acting as resistance zone after it was broken. The proximity of this resistance zone increases the probability USD/CAD will continue to fall inside this Down Channel.
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