Technical Analysis – USD/CAD consolidates in triangle pattern

USD/CAD is consolidating in a descending triangle after a long term rally from 1.0619 last July. The triangle base provides support at 1.2350. A break below this would target next support 1.2050.

To the upside, a breakout from the triangle would bring a resumption of the uptrend. A move above the 6-year high of high of 1.2798 (hit on January 30) will open the path towards the March 2009 high of 1.3063.

The near term bias is neutral as the RSI indicating consolidation is in progress. It is hugging the 50 line and is showing the upside momentum has fallen.

Overall, the long term trend is bullish, with prices making higher highs and higher lows especially since the strong rally from last July. Prices are above the Ichimoku cloud and this highlights the underlying bullish trend.

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