USDCAD has turned down to the lows as expected after bounce to 1.2300 proved to be a corrective rally as is was made only by three waves. It was red wave 4) that belongs to an ending diagonal which is now in last leg of decline. However there is still room for 1.2550 area in the short-term where we will pay attention to an impulsive turn. Five waves up back to around 1.2900 would be strong evidence of a completed decline.
USDCAD, 4H
The ending diagonal is a special type of motive wave that occurs primarily in the wave 5 position when price has moved too far and too fast. Some ending diagonal triangles appear in the C wave of an ABC correction. In all cases, the ending diagonal terminates the move of larger patterns.
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