The Great Britain pound versus the Canadian dollar currency pair seems to have limited the bearish attempts to further induce a depreciation.
After confirming the support area of 1.5936, the price commenced an upwards pointing trend, one that extended until the long-time resistance area of 1.7811. From there, a strong retracement took place, so strong that it was able to cross two levels with ease: 1.7499 and 1.7160.
But the bearish pressure was not able to last enough for the 1.6986 to be pierced. This resulted in an appreciation that closed the candle on December 31, above the 1.7160 level.
But this small bullish victory was followed by a bearish attempt to continue the movement towards the south. However, the candle on December 6, closed in such a way that it caused a bullish engulfing pattern.
The fact that the bullish engulfing occurred in the area of a level that already withstood a bearish attempt — 1.6986 — only enforces the bullish confidence.
So, as long as the price oscillates above 1.6986 and it keeps its role as a support, conquering 1.7160 is just a matter of time. Once it is confirmed as support, further extension to 1.7499 — which also is the first target — is to be expected, it being followed by 1.7811, the second target, respectively.
Only if 1.6986 gives way, the path to 1.6620 is open.
The price is limited by the support of 1.6959 and the resistance of 1.7130. As can be seen, the market tries to decelerate from the depreciation that started at 1.7727, thus forming a consolidation phase that looks like it is turning and establishing a route towards higher prices.
In this context, if 1.7130 gets confirmed as support, the first bullish target is 1.7288, followed by 1.7383. If this fails to happen and if the bears put more pressure, then 1.6959 may give way, rendering 1.6684 as the main target.
Levels to keep an eye on:
D1: 1.6986 1.7160 1.7499 1.7811 1.6620
H4: 1.7130 1.7288 1.7383 1.6959 1.6684
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