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GBP/CAD - Trading a Consolidation-Bearish Market at Resistance

GBP/CAD has been falling sine the end of August from a 2.0970 high to a 1.9732 low in October. But as we can see in the 4H chart, the pair has been consolidating for most of the month. 

GBP/CAD 4H Chart 10/19
(click to enlarge)

Price action is currently in a bullish mode .Within the context of consolidation a rally should be monitored at resistance. So far, resistance has been just above 2.00 the psychological level, and a support pivot in early September. There could be further upside, but if price approaches the 2.0150 area, I would anticipate resistance. If I do see resistance, I might jump on a sell with conservative and aggressive targets of 1.99 and 1.98 respectively.

Now, if price pushes above 2.0210, GBP/CAD would have broken above the cluster of 200-, 100-. and 50-period simple moving averages as well as a falling trendline. If the RSI also pushes above 70 in the 4H chart, we would likely be seeing a shift into a bullish market at least in the short to medium-term, with upside to 2.0550 and 2.0970. 

As far as the downside. My noted targets are within the context of a consolidation. If you believe the market is in a downtrend, you might consider downside risk to 1.94. In the daily chart, this is where the 200-day SMA resides. I want to stick with the consolidation scenario first because the pair  has been in this mode throughout October. Consider GBP/CAD a neutral market with potential to continue its medium-term bearish correction. This suggests a sell with cautious target. 

GBP/CAD Daily Chart 10/19
(click to enlarge)