The pair has been trending down when a bullish breakout above the bearish daily channel took place. However, the potential downside move remains valid as long as the pair is trading below 1.0040 and below 1.0000 area, the psychological resistance.
On Friday, the USD/CAD pair expressed strong bearish reaction towards 1.0020, shortly after the USD/CAD pair reached down to 0.9880 which corresponds to 50% Fibonacci Level.
Price zone 0.9880-09845 (Important Fibonacci Levels) provided strong support expressing strong bullish price action which is manifest on the daily chart.
This allowed the USD/CAD pair to initiate a bullish move towards 1.0025 corresponding to the upper limit of the bullish channel depicted on the charts. However, the bearish reaction suggests a coming bearish movement, which needs 0.9980 to be broken down early today.


Support: 0.9970, 0.9925, and 0.9875.
Resistance: 0.9990,1.0010, and 1.0040.

• Recommendation  

Price Action towards the price zone 1.0025 - 1.0040 should be watched carefully for a possible valid SELL entry with SL located above 1.0060.
Obvious breakdown below 0.9980 supports the bearish scenario in the short-term targeting 0.9900 initially.