{"id":13207,"date":"2025-05-22T21:45:27","date_gmt":"2025-05-22T21:45:27","guid":{"rendered":"https:\/\/alchemymarkets.com\/?post_type=market_insights&#038;p=13207"},"modified":"2025-05-22T21:45:28","modified_gmt":"2025-05-22T21:45:28","slug":"loonie-on-the-edge-usd-cad","status":"publish","type":"market_insights","link":"https:\/\/alchemymarkets.com\/it\/education\/market-insights\/elliott-wave\/loonie-on-the-edge-usd-cad\/","title":{"rendered":"Loonie on the Edge: USD\/CAD Elliott Wave Breakdown"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\"><strong>Executive Summary:<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Major Trendline Hit:<\/strong> On the 1W chart, USD\/CAD has reached a 4-year ascending trendline, a breakdown suggests a larger downtrend underway.<br><\/li>\n\n\n\n<li><strong>Bearish Impulse Developing:<\/strong> The 1D chart suggests an uncompleted 5-wave bearish structure that could lead to further declines.<br><\/li>\n\n\n\n<li><strong>Key Level to Watch:<\/strong> 1.3750 is critical. A sustained break below this level confirms a deeper correction toward the 1.20.<br><\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Current Elliott Wave Analysis<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Weekly Chart (1W)<\/strong><\/h3>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"772\" src=\"https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/05\/USDCAD_2025-05-22_16-10-34-1024x772.png\" alt=\"\" class=\"wp-image-13208\" srcset=\"https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/05\/USDCAD_2025-05-22_16-10-34-1024x772.png 1024w, https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/05\/USDCAD_2025-05-22_16-10-34-300x226.png 300w, https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/05\/USDCAD_2025-05-22_16-10-34-768x579.png 768w, https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/05\/USDCAD_2025-05-22_16-10-34.png 1173w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>The weekly <a href=\"https:\/\/alchemymarkets.com\/education\/guides\/elliott-wave-theory\/\">Elliott wave<\/a> chart for USD\/CAD shows a major top in February 2025 as wave (B) of a larger flat pattern that began in 2016. If so, then a decline to 1.20 may appear over the next several months.<\/p>\n\n\n\n<p>Since 2021, USDCAD has been contained by an upward sloping <a href=\"https:\/\/alchemymarkets.com\/education\/guides\/support-and-resistance\/\">support trend line<\/a>. USDCAD has declined to meet this trend line and has bounced slightly.<\/p>\n\n\n\n<p>There is additional support in the current price zone marked by previous swing highs (yellow box and blue arrows).<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Daily Chart (1D)<\/strong><\/h3>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"772\" src=\"https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/05\/USDCAD_2025-05-22_16-27-29-1024x772.png\" alt=\"\" class=\"wp-image-13210\" srcset=\"https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/05\/USDCAD_2025-05-22_16-27-29-1024x772.png 1024w, https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/05\/USDCAD_2025-05-22_16-27-29-300x226.png 300w, https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/05\/USDCAD_2025-05-22_16-27-29-768x579.png 768w, https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/05\/USDCAD_2025-05-22_16-27-29.png 1173w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>Zooming into the daily timeframe, the decline from 1.4793 appears to be a developing impulse pattern. Price is currently within wave (v) of ((iii)) of the five wave impulse.<\/p>\n\n\n\n<p>If this model is correct, then the decline in wave (v) of ((iii)) likely falls to 1.3675-1.3710.<\/p>\n\n\n\n<p>It is within this price range where wave ((iii)) would be a <a href=\"https:\/\/alchemymarkets.com\/education\/indicators\/fibonacci-extensions\/\">1.618 Fibonacci extension<\/a> of wave ((i)). Additionally, wave (v) would equal the length of wave (i). Both are common wave relationships.<\/p>\n\n\n\n<p>You\u2019ll notice that the trend line from 2021 is hovering just above this price level.<\/p>\n\n\n\n<p>As a result, if a new low is reached below 1.3750, then it will add more evidence of an incomplete bearish impulse pattern.<\/p>\n\n\n\n<p>Then, a forceful breakdown below the trend line will likely be witnessed in the coming weeks signalling a larger downtrend towards 1.20.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Bottom Line<\/strong><\/h2>\n\n\n\n<p>USD\/CAD appears to have reached a major top at 1.4793 and a breakdown below the 2021 trend line will confirm it.<\/p>\n\n\n\n<p>If the 2021 trend line breaks, it suggests a larger expanded flat pattern since 2016 and wave \u2018C\u2019 of the flat may trend towards 1.20.<\/p>\n\n\n\n<p>A break above 1.43 would negate this forecast and suggest the larger uptrend is ongoing.<\/p>\n\n\n\n<p><strong><em>You might be interested in\u2026<\/em><\/strong><\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-wp-embed is-provider-alchemy-markets wp-block-embed-alchemy-markets\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"wp-embedded-content\" data-secret=\"DQrXG1h7H4\"><a href=\"https:\/\/alchemymarkets.com\/education\/market-insights\/elliott-wave\/gbp-usd-2-wave-scenarios\/\">GBP\/USD Elliott Wave: 2 Wave Scenarios<\/a><\/blockquote><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; visibility: hidden;\" title=\"&#8220;GBP\/USD Elliott Wave: 2 Wave Scenarios&#8221; &#8212; Alchemy Markets\" src=\"https:\/\/alchemymarkets.com\/education\/market-insights\/elliott-wave\/gbp-usd-2-wave-scenarios\/embed\/#?secret=xYd1dNSdNu#?secret=DQrXG1h7H4\" data-secret=\"DQrXG1h7H4\" width=\"500\" height=\"282\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe>\n<\/div><\/figure>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>USD\/CAD Elliott Wave analysis highlights key support from a weekly trendline and forecasts a bearish downtrend that may reach 1.20. See other key levels inside.<\/p>\n","protected":false},"author":160,"featured_media":13212,"parent":0,"comment_status":"open","ping_status":"closed","template":"","market_insights_categories":[16],"class_list":["post-13207","market_insights","type-market_insights","status-publish","has-post-thumbnail","hentry","market_insights_categories-elliott-wave"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.9 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Loonie on the Edge: USD\/CAD Elliott Wave Breakdown - Alchemy Markets<\/title>\n<meta name=\"description\" content=\"USD\/CAD Elliott Wave analysis highlights key support from a weekly trendline and forecasts a bearish downtrend that may reach 1.20. 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