USD/CAD Elliott Wave Analysis

USD/CAD – 1.0543

USD/CAD – Wave v of c has possibly ended at 1.0206

Despite falling to 1.0371 on Monday, as the greenback has rebounded, suggesting the retreat from 1.0781 has possibly ended and consolidation with upside bias is seen for gain to 1.0690/00, however, break of 1.0781 resistance is needed to signal the 3rd leg of wave iii is under way for further gain to 1.0871. later next month.

To recap our preferred count is that the A of (B) rally from 0.9059 low (7 Nov 2007) unfolded into an impulsive wave with i:0.9059-1.0380, ii ended at 0.9819, wave iii at 1.3019 followed by a triangle wave iv at 1.2026, then wave v formed a top at 1.3066 and also ended the wave A. Wave B is unfolding as an a-b-c and is sub-divided as a: 1.2192, b: 1.2716 and wave c is a 5-waver with i: 1.1983, ii: 1.2506, extended wave iii: 1.0784 and wave iv ended at 1.1725. At the moment, we are still keeping our preferred count that wave v has ended at 1.0206 and the rise from 1.0206 to 1.0871 is tentatively treated as wave I with wave ii possibly ended at 1.0225.

On the upside, it is necessary to see a breach of resistance at 1.0871 to confirm our bullish count that wave iii is under way for gain to resistance at 1.0996 but a sustain breach above there is needed to encourage for headway to resistance at 1.1126.

On the downside, expect 1.0371 to continue to hold, bring such a rise. Only loss of 1.0300 would risk test of 1.0225 but a daily close below 1.0206 is needed to signal recent decline is still in progress for weakness towards 1.0005 (76.4% Fibonacci retracement of 0.9059 to 1.3066). However, sharp fall below there would not be repeated and reckon downside should be limited to 0.9862 (100% projection of 1.1725-1.0591 measuring from 1.0996).

Based on ActionForex.com Technical Outlook