NZDCAD missed the 90c yesterday. The pair has been trading along the median regression trendline of the 0.8016-0.8560 channel. Therefore, there have been limited attempts to break the outside channels. However, the higher lows recorded suggest a bullish bias.
Should there be a break in the median regression trendline, we could expect an attempt towards the upper channel. This could lead to fresh highs at 0.9090. This is the 100% Fibonacci expansion of the 0.8016-0.8560 leg.
The RSI supports this outlook as it indicates a bullish hidden divergence.
The shorter-term chart above indicates a slight decline as it failed to break the median regression. This suggests that the pair could revist the lower regression of the 0.8348-0.8780 channel.
Initial support could be found near the 38.2% Fibonacci retracement of the 0.8745-0.8980 leg. We anticipate the said level to hold firm due to its confluence with the lower regression trendline.
Should we see a false break, a test of the long-term median regression channel could occur. We could expect the upside test towards the 100% Fibonacci expansion near 0.9090.
However, with the short-term RSI providing no divergence signals, the trend could continue without a pullback.
