The Great Britain pound versus the Canadian dollar currency pair appreciated beautifully, but a moment comes when the market retraces. Is the market in front of it?
Long-term perspective
The support of 1.5936, even if weakened, managed to facilitate an appreciation that turned out to be a very healthy one, as important areas — like 1.6413 and 1.6620 — were breached and allowed the departure of the price.
Even if the bears tried to oppose, in the areas of 1.6986 and 1.7160, respectively, the bulls were able to push through the latter one and reach the 1.7499 resistance.
The candle of December 9 has a long tail that extends to the upwards and a small body, pointing to be a shooting star candlestick pattern, which in turn would signal a depreciation.
However, as the lower tail is longer than the body, the candle cannot be considered a valid shooting star. The only positive aspect for the bears in this context is that the candle sketching the shooting star occurs around a resistance area, an alignment which gives them credit.
But as the candle did not yet touched the level, no confirmation occurred and, as a result, the bulls could still hope for another push towards the north.
What could come to the aid of the bears is the closure of today’s candle — December 10 — bellow the halfway point of the December 8 candle, rendering the three candles as an evening star candlestick pattern. If this happens (or if the price falsely pierces the 1.7499 level), then the bears will target 1.7160.
But unless that happens, the price still sights the long-term resistance area 1.7811.
Short-term perspective
The price is in an ascending channel, currently touching the resistance trendline. So, as long as the price remains contained in the channel, the appreciation is expected to continue.
The appreciation can renew after further oscillation above the 1.7383 level, as any confirmation as support — or a false piercing — represents a new bullish opportunity.
If 1.7383 gives way, then the candidates for serving as support are 1.7288 and the lower trendline of the ascending channel, respectively.
The target that the bulls eye is represented by the 1.7609 level.
Levels to keep an eye on:
D1: 1.7499 1.7160 1.7811
H4: 1.7383 1.7288 1.7609
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