On the weekly chart, it is obvious that GBP/CAD has been in the consolidation phase since the end of 2016, when the price bottomed out at 1.5730. While in the long-term perspective, there is no definitive trend, in the medium term, GBP/CAD could be aiming for the top of the range, which is near 1.7930.
It can be seen that the price broke above the downtrend trendline, after which it corrected down, and found support at the same trendline, which has acted as the support. At the same time, this week, the uptrend trendline has been rejected along with the 50 Exponential Moving Average. This goes to show that bulls are still in control and in the medium term, GBP/CAD price could be rising towards the 1.7930 supply area.
As shown on the chart, this resistance area is confirmed by 3 different Fibonacci retracement levels. The 88.6% Fibs applied to the 2014 - 2015 wave up after price rejected the 50 EMA. The 61.8% Fibs, applied to the 2016-2017 wave down, after price rejected the 50 EMA. And finally, the 127.2% Fibs, applied to the corrective wave down, where the downtrend trendline got rejected.
All of these Fibonacci retracement levels almost precisely correspond to the 1.7930 level, implying the importance of this price area. It means that if the uptrend takes place, GBP/CAD might rise by a huge 700-800 pips in the 2 to 4 weeks. This is because the consolidation has been quite extended, and now the price could be starting to move fast.
On the downside, a break below the 1.6800 psychological support, will invalidate the medium-term bullish outlook, and GBP/CAD long term downtrend might continue.
Key support levels: 1.6850, 1.6800
Key resistance levels: 1.7530, 1.7930
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Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.
It can be seen that the price broke above the downtrend trendline, after which it corrected down, and found support at the same trendline, which has acted as the support. At the same time, this week, the uptrend trendline has been rejected along with the 50 Exponential Moving Average. This goes to show that bulls are still in control and in the medium term, GBP/CAD price could be rising towards the 1.7930 supply area.
As shown on the chart, this resistance area is confirmed by 3 different Fibonacci retracement levels. The 88.6% Fibs applied to the 2014 - 2015 wave up after price rejected the 50 EMA. The 61.8% Fibs, applied to the 2016-2017 wave down, after price rejected the 50 EMA. And finally, the 127.2% Fibs, applied to the corrective wave down, where the downtrend trendline got rejected.
All of these Fibonacci retracement levels almost precisely correspond to the 1.7930 level, implying the importance of this price area. It means that if the uptrend takes place, GBP/CAD might rise by a huge 700-800 pips in the 2 to 4 weeks. This is because the consolidation has been quite extended, and now the price could be starting to move fast.
On the downside, a break below the 1.6800 psychological support, will invalidate the medium-term bullish outlook, and GBP/CAD long term downtrend might continue.
Key support levels: 1.6850, 1.6800
Key resistance levels: 1.7530, 1.7930
Thanks for your support! If you liked this analysis, please support our profile with a 👍 and follow us to get a new daily analysis.
Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.