By Orbex

The formation of the USDCAD currency pair suggests the development of a large bearish double zigzag. Intervening wave x can take the form of a primary double zigzag Ⓦ-Ⓧ-Ⓨ.

To complete this double zigzag, a primary wave Ⓨ is necessary. Most likely, its first two parts have ended, and now the last actionary intermediate sub-wave (Y) is under construction.

The end of this wave could be near 1.303. At that level, wave Ⓨ will be at 76.4% of wave Ⓦ.

An alternative scenario suggests the continuation of the construction of the cycle sub-wave w, or rather its final part, where the minute correction wave was recently completed. It took the form of a double zigzag (w)-(x)-(y).

And then the market began to move in a downward direction, forming the final impulse wave ⓥ.

To confirm this scenario, we need to see a decline in the minuette sub-waves (iii)-(iv)-(v) as shown on the chart.

We can expect the end of the impulse (iii) at the previous low of 1.201. Then, after a slight correction in the sub-wave (iv), the price will continue to decline in the minuette sub-wave (v).

Article by Orbex

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