GBP/CAD has broken below the confirmation level for the breakout from its Rising Wedge pattern. It is likely to continue lower until it fulfills the minimum price objective for the pattern.
GBP/CAD is extending its decline after breaking out of a bearish Rising Wedge pattern.
The pair has already pierced below the October 3 lows (dashed red line), one of the confirmation levels for the pattern and is therefore likely to continue lower.
GBP/CAD Daily Chart
(Click on image to enlarge)
The next target to the downside is at 1.7518, the 61.8% extrapolation of the width of the Rising Wedge at its widest part extrapolated lower. This is the usual technical method for forecasting breakouts.
Prior to the breakdown, GBP/CAD broke temporarily above the upper guardrail of the Rising Wedge pattern on several occasions (blue circles on chart) on September 20 and November 1. This is a sign of bullish exhaustion and an early warning of impending reversal.
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