Wednesday, November 9, 2022 4:27 PM EDT
Photo by Michelle Spollen on Unsplash
With oil and risk assets coming under pressure today, the Canadian dollar has sold off, while the US dollar has risen across the board after its recent weakness.
As a result, the USD/CAD is on the rise and it may go on to invalidate the head and shoulders pattern that it had created a few days ago.
If we climb and hold above the neckline area above 1.3500 area then this will put the bears in a spot of bother. We could then see a sharp rally towards levels where the bulls’ stops might be resting.
(Click on image to enlarge)
Source: TradingCandles.com
If it plays out how I have described it above, then the first target would be around 1.3682, the base of the break down around the right shoulder area. Thereafter we might see a potential move above 1.3810 where the trapped short stops would be resting, and potentially even 1.40 – above the head of the H&S pattern.
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