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USD/CAD Rallies after Poor CAN Wholesale Sales

Canadian Wholesale Sales for the month of March disappointed and the CAD slid during the 5/20 US session.

Wholesale Sales (March) m/m: -0.4%
Forecast: 0.4%
Previous (Feb) m/m: 1.1%

Support after Down Swing:
The USD/CAD found support around 1.0850 to start the week. The 4H chart shows that the prevailing trend has been bearish since mid-March, when USD/CAD peaked at 1.1277. This was also the 2014-high.


(usdcad 4h chart, 5/20)

Bullish Signals:
A couple of things seem to reflect USD/CAD shifting from bearish to neutral, and possibly back to bullish.

1) Price is breaking above a falling trendline from the 2014-high
2) The 4H RSI is pushing above 60, which reflects a loss of bearish momentum in this time-frame.

Bullish outlook:
The bullish outlook is a bit premature, but the bullish break should bring the buy on a dip trading idea into consideration. A break above 1.0935 should help bulls gain confidence, but a break above 1.10 might be needed to convince traders of a bullish continuation.


(usdcad daily chart)

Bullish-cycle:
As you can see on the daily chart, the prevailing trend is still bullish, and the oscillators show that the market has completed a bear-cycle, and could be entering a bull-cycle. So whether the market is neutral or bullish, at least a short-term bullish outlook can be expected for this and the upcoming week.