USDCAD: Elliott wave analysis and forecast for 31.12.21 – 07.01.22

Main scenario: consider short positions from corrections below the level of 1.2961 with a target of 1.2620 – 1.2543.

Alternative scenario: breakout and consolidation above the level of 1.2961 will allow the pair to continue rising to the levels of 1.3166 – 1.3382.

Analysis: A descending correction appears to have formed as the fourth wave 4 of larger degree on the daily chart, with wave (С) of 4 completed and an ascending wave 5 unfolding inside. A downward correction is completed in the form of wave 2 of (1) of 5 and the third wave 3 of (1) has started developing on the H4 chart. Apparently, the first wave of smaller degree i of 3 has formed on the H1 chart. Also, a downward correction is developing as the second wave ii of 3, with wave (c) of ii unfolding as its part. If the presumption is correct, the pair will continue to drop to the levels of 1.2620 – 1.2543. The level of 1.2961 is critical in this scenario as a breakout will enable the pair to continue rising to the levels of 1.3166 – 1.3382.

Price chart of USDCAD in real time mode

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