Overview:

Two months ago, the bearish swing (initiated in March 2014) was stopped at the price level of 1.0620. This price level corresponded to the lower limit of the channel as well as the backside of a steeper bearish one.

A bullish breakout off the movement channel took place in August. Since then, the pair has been trending-up within the depicted bullish channels.

Bulls were pushing beyond the upper limit of the movement channel in mid-October. The USD/CAD pair looked overbought on the daily chart then.

Few days ago, the USD/CAD pair tested the upper limit of the steeper channel. This corresponded to the price level of 1.1370. Immediate bearish rejection was expressed as anticipated after such a long bullish swing resulting in a bearish correction towards 1.1200.

As anticipated, 4H fixation below 1.1230 - 1.1210 ( 50% Fibonacci level ) allowed the bears to push towards 1.1100 where bullish recovery was expressed as anticipated this week.

Today, the bulls have pushed further above price level of 1.1300. Note that price level of 1.1330 corresponds to the backside of the broken channel as well as previous bearish spikes on the daily chart.

Bearish rejection should be anticipated. Thus, a good short position may be offered there.

Recommendations:

The current price levels up to 1.1350 probably offers a valid SELL entry with SL located just above 1.1385.

Target levels should be set as 1.1160 then 1.1100 to come next.