GBP/CAD: upside potential
• GBP/CAD reversed from support zone
• Next buy target - 1.9250
GBP/CAD recently rose sharply – breaking both of the buy targets which were set in our previous report for this currency pair (1.8800 and 1.9000). The sharp minor impulse (i) which broke these resistance levels extended further – toward the next strong resistance level 1.9250 - from where GBP/CAD reversed down. The subsequent downward correction (ii) from this resistance level stopped at the combined support zone lying between the former resistance level 1.8800 (acting as support now after it was broken last month) and the 38.2% Fibonacci Correction of the previous upward impulse from the middle of January.
The upward reversal from this support zone created the strong Japanese candlesticks reversal pattern – daily Bullish Engulfing – thereby completing the minor wave (ii). GBP/CAD is likely to rise further to the next buy target at 1.9250.