The USDCAD structure hints at a bearish impulse consisting of intermediate waves (1)-(2)-(3)-(4)-(5). The impulse is part of a primary degree Ⓐ-Ⓑ-Ⓒ zigzag.
At the time of writing, waves (1)-(2)-(3)-(4) are fully complete. The correction in wave (4) ended in a triangle formation, kicking off wave (5).
Sub-waves 1-2-3 of (5) are complete. The bullish correction in wave 4 is currently in play.
Once completed, wave (5) could decline to 1.319. At that level, wave (5) will be at 61.8% of impulse wave (3).
An alternative view shows correction wave (4) as a zigzag with waves W and X completed. Wave Y is currently under development.
In the short term, we can expect prices to extend up to 1.371. This is the previous high formed by wave W.
A decline in the final wave (5) could then begin to develop.
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