Created
: 2024.09.26
2024.09.26 19:49
GBP/CAD might have reversed its short-term uptrend after testing the top of its rising channel, forming a bearish reversal candlestick pattern (orange rectangle on chart below) and then establishing a sequence of lower lows and lower highs.
Although GBP/CAD has pulled back over recent periods, it has probably reversed trend and a break below 1.7946 (September 25 low) would confirm more downside. Downside targets lie at 1.7754 (September 17 low and 50-day SMA), 1.7694 (September 16 low) and 1.7603 (September 4 low) and 1.7407 (August 8 low). A break below 1.7907 would provide stronger confirmation.
Although GBP/CAD is in an uptrend on all time frames, it is nevertheless oscillating within an ascending channel. It is possible, therefore, that it may be entering one of its counter-trend bear phases.
The Relative Strength Index (RSI) has formed a bearish divergence with price compared to the September 17 low (red dashed line on chart above). Although the price was much lower on September 17 momentum was not. This suggests underlying weakness could push prices down.
A break above the high of the Shooting Star at 1.8245 would confirm a resumption of the uptrend. If so, the next target lies at 1.8278, the 61.8% extrapolation of the prior move higher.
Any further bullishness beyond the confines of the channel is likely to be short-lived, however. Such moves are signs of "exhaustion" and are a precursor to deeper corrections on the horizon.
Created
: 2024.09.26
Last updated
: 2024.09.26
FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.
We hope you find this article useful. Any comments or suggestions will be greatly appreciated.
We are also looking for writers with extensive experience in forex and crypto to join us.
please contact us at [email protected].
Disclaimer:
All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.
The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.
Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy