Last week, the USD/CAD pair resumed its growth and tested 1.4000, correcting the medium-term downward trend, and is now holding in this area. The strengthening of the American currency was associated with a number of positive signals about the reduction of trade tensions between the United States and its leading partners, primarily China.

Growth is possible.

On the weekly chart, the upward fifth wave of the highest level (5) develops, within which the third wave of the lowest level 3 of (5) forms. On the daily chart, the correctional fourth wave 4 of (5) and the wave c of 4 have ended, and the fifth wave 5 of (5) has started. If the assumption is correct, the USD/CAD pair will grow to the area of 1.4780–1.5000. In this scenario, the critical stop loss level is 1.3745.

During the Asian session, the USD/CAD pair is developing the downward momentum formed yesterday and retreating from the highs of April 10 against macroeconomic statistics that increased the likelihood of an imminent adjustment of the US Fed’s monetary policy.

Amid progress in trade talks between US and Chinese representatives, the USD/CAD pair reached 1.3973 and is currently testing the resistance level of 1.3950: following the results of consultations held last weekend in Switzerland, official Beijing will reduce tariffs from 125.0% to 10.0% for 90 days from May 14, and the White House will reduce them from 145.0% to 30.0% (10.0% core rate and 20.0% mutual sanctions). 

During the Asian session, the USD/CAD pair is correcting at 1.3914 amid talks between Canadian Prime Minister Mark Carney and US President Donald Trump. 

On the four-hour chart, a large Falling Wedge graphic pattern is being built, which the price is expected to leave upwards, and the target is located in the area of 1.4025.