USDCAD extended its one-month trading range above the more-than-six-year low of 1.2006, increasing speculation that the bears are losing steam and the bulls may take charge soon. Still, unless the 1.2145 – 1.2160 area gives way, a negative move towards the 1.2006 barrier is likely. Underneath this level, the door would open for the 1.1920 support, taken from the low in February 2015.
Nevertheless, if the bulls win the battle with the 1.2145 hurdle and the 23.6% Fibonacci retracement level of the down leg from 1.2645 to 1.2012 at 1.2165, the target will immediately shift to the 200-period SMA at 1.2173, a break of which could halt near the 1.2200 handle.
Summarizing, the broad picture has been bearish since the intact long-term downtrend started from the 1.4667 top. Technically, however, a decisive close above the 200-period SMA is required for a new bullish wave to officially start.