The current USDCAD chart shows the internal structure of a large correction pattern, which most likely takes the form of a cycle triple zigzag w-x-y-x-z| FXMAG.COM

Perhaps the first four parts of this construction are fully completed, and now the final actionary leg is being built – the sub-wave z. Apparently, the wave z takes the form of a primary double zigzag Ⓦ-Ⓧ-Ⓨ, where the sub-waves Ⓦ-Ⓧ are formed.

Thus, the last actionary wave Ⓨ can be formed at the moment.

It may end in the form of a standard zigzag (A)-(B)-(C) near 1.403. At that level, cycle wave z will be at 161.8% of cycle wave y.

Let’s consider an alternative scenario, as seen above. According to this, the formation of a cycle triple zigzag could be fully completed. Therefore, let's assume that the initial part of a new bearish trend is forming.

We assume the construction of a primary double zigzag Ⓦ-Ⓧ-Ⓨ, which is the beginning in a larger correction pattern.

It is likely that the primary waves Ⓦ-Ⓧ have already been completed, each of which is a double zigzag of the intermediate degree.

In the near future, we can expect the formation of a bearish primary wave Ⓨ, which may take the standard zigzag shape (A)-(B)-(C) and end near 1.331. At that level, the primary waves Ⓦ and Ⓨ will be equal.

Jing Ren

Jing-Ren has extensive experience in currency and commodities trading. He began his career in metal sales and trading at Societe Generale in London. Later on he worked as a senior analyst within the FX brokerage industry where he developed strategies in trading and risk management. With solid understanding of market dynamics he founded Wensfer to offer research and asset management services.