FXstreet.com (Barcelona) - The view over the last few months in $/cad remains unchanged as the market continues to form a large pennant/triangle since Oct, generally seen as a continuation pattern and suggests an eventual upside break of the ceiling (currently at 1.2985/15). However, these patterns break down into 5 legs and raises potential for a final downleg back to the base first (currently at 1.2025, see ideal scenario in red on daily chart below). Still long from the early Feb buy at 1.2435 and given the risk that an important top may be close, would use a very aggressive stop on a break below the week long bullish trendline (currently at 1.2720/30). Note also, would take profits on an intraday break (versus waiting for the close) as a turn lower from ceiling (if it does indeed occur), may be sharp and don't want to be taking profits at significantly lower levels by waiting for the close (if that does indeed occur).
Longer term, the bigger picture bullish bias that has been in place since last Aug near 1.0300 (broke above the multi-month pennant and warned that they resolve sharply higher) remains in place. As mentioned above, the consolidation/triangle since last Oct is seen as a continuation pattern/correction (wave 4 in the rally from the Nov 2007 low at .9060), and suggests an eventual upside resolution (though there is some risk for a final test of the base first, see ideal scenario in red on weekly chart/2nd chart below). So for now, would maintain the long held, longer term bullish but will start to look for signs of a more important top on the upside resolution of the 6 month correction (potential triangle/pennant). Longer term resistance above 1.3015 is seen at 1.3450/00 (62% retracement from the Jan 2002 high at 1.6185).