The USDCAD on the H4 time frame had upward structural momentum that lasted until 30 September when a higher top was recorded at 1.38338. After the higher top at 1.38338, the price broke through the 15 and 34 Simple Moving Averages and the Momentum Oscillator changed direction into bearish terrain. This confirmed that the bears were getting serious.
A possible critical support level formed when a lower bottom was recorded on 4 October at 1.35668. The bulls are currently trying to take control of the market again and they might get some resistance at the 1.3700 where the 15 Simple Moving Average is potentially crossing the 34 Simple Moving Averages.
If the price of the USDCAD currency pair breaks through the critical support level at 1.35668, three possible price targets can be projected from there. Attaching the Fibonacci tool to the lower bottom at 1.35668, and dragging it to the potential resistance level at 1.37000, the following targets can be calculated. The first target may be estimated at 1.34845 (161.8%). The second price target can be calculated at 1.33513 (261.8%) and the third and final target can be expected at 1.31358 (423.6%).
If the resistance level at 1.37000 is broken, the above scenario is not valid any longer and must be re-assessed. As long as supply overcomes demand and lower tops and bottoms are formed, the outlook for USDCAD will remain bearish.