GBPCAD currency pair recently reversed from the support area between the support level 1.8720 (which reversed the price multiple times at the end of June), lower daily Bollinger Band and the 61.8% Fibonacci correction of the upward impulse from May.
GBP/CAD has spent the past few weeks tracing out a clean five-wave rally on the 1-hour chart, and now the pair looks to be working through the correction that typically follows a completed impulse. Here's a breakdown of the structure and what it could mean for the path ahead.
GBP/CAD climbed to its highest level in a decade this week, reflecting an increasingly powerful divergence between a Pound supported by fading domestic political risks and a Canadian Dollar facing mounting structural headwinds. Sterling continues to benefit from the unwinding of sizeable speculative short positions built ahead of Prime Minister Keir Starmer's resignation, while Bank of England Governor Andrew Bailey has effectively ruled out near-term rate cuts.