USD/CAD Channel Up Sets the Scene for a Intraday Reversal

The loonie has been losing ground against the U.S. Dollar as the 0.9522 low seems to have stirred awake USD/CAD bulls. Crude oil has stagnated below 110/bbl and this could be fueling some of the loonie pessimism but the case for bullish greenback cannot be made here and that’s why I see a push lower…resuming the overall downtrend.

The Directional Bias of the USD/CAD is still BEARISH therefore positioning my entries at resistance levels or as support fails is a higher percentage entry in my opinion.

The Channel Up pattern on the 240-minute chart is wide and short enough to also have Bear Flag characteristics which means this could be setting up a reversal. Remember that essentially a Channel or Flag is simply parallel trendlines so we’re looking for how price action behaves at these levels.

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USD/CAD 240-minute chart with Channel Up chart pattern alert courtesy of Autochartist

If prices can trade through the lower uptrend line of the pattern, look for to short this move which is also a trend following entry of the overall downtrend that can be seen on the daily chart.