USDCAD coils under a broken base

  • July 17, 2026
  • Posted by: EWGFX
  • Category: Technical analysis
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THE SETUP
USDCAD topped near 1.4247 in late June and has carved a rounded top, rolling over into a clean run of lower highs. Price is now pressing the 1.3950 base, the shelf it broke out from in mid-June. I am not short yet. This trade only arms if the base gives way.

CONFLUENCES

  • Daily trend has flipped down: rounded top, lower highs off the 1.4247 peak
  • 1.3950 is real structure: the June breakout base, now the line in the sand
  • Momentum is with the move: a run of heavy red daily candles into the level
  • Clean invalidation just above (1.4010), keeping RR to TP1 near 1.5

FUNDAMENTALS
CAD firmed after the Bank of Canada held at 2.25%, and a softer US inflation print has the dollar heading for a weekly loss. This is data-sensitive, but no BoC or Fed event lands before these levels are in play.

TRADE PLAN (conditional, marked on the chart)
Trigger: daily close below 1.3950. No close, no trade.
Entry: sell the retest of 1.3950 to 1.3965 from below.
Stop: 1.4010 (base reclaimed = idea wrong).
TP1: 1.3880, TP2: 1.3820, TP3: 1.3770.
Invalidation: a daily close back above 1.4010, or price never breaking 1.3950 within the window shown.