USDCAD looks ready to drop 200 pips
The Canadian economy is significantly under-performing the U.S. economy, prompting the Canadian central bank to begin cutting interest rates. Despite this, the Canadian dollar has remained relatively strong.
In addition, weak economic data from the U.S. has recently pushed the U.S. dollar to new lows.
The charts indicate the potential for even lower prices, as a large descending triangle pattern has formed. This pattern suggests a drop to $1.34, although reaching that low is unlikely. Also, obtaining a good risk-to-reward ratio is possible without holding a short position to 1.34. Instead, I would focus on the $1.35 and $1.3475 levels.
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