Price Shift Coming? GBPCAD price action is catching my eye here. The market has been trading higher within a broad bullish channel over recent months. However, price is now potentially carving out a large double top pattern with strong bearish divergence on momentum studies. The market is now turning lower, about to test the 1.7198 level support. Look for a break below here to target a test of the 1.7041 level, confirming a break of the channel. The retail market has been heavily short across the ascent but is now switching long as prices decline, suggesting room for a much deeper move as this theme develops (currently only 55% long).Keep An Eye OnThe main driver here is the rally in CAD in response to higher oil prices. With Russia and Ukraine engaged in military conflict there are clear upside risks for oil in the coming days and weeks which should keep GBPCAD under pressure. Fears of the impact of the conflict on European nations’ economies as well as the risks of the UK becoming involved in the conflict, will likely also keep the pair pressured. With this in mind, it is vital to monitor news flow around this situation as it continues.
Source: Tickmill
