GBP/CAD Price Forecast: Nearing upper channel line, bearish divergence

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GBP/CAD Price Forecast: Nearing upper channel line, bearish divergence
Technical Analysis
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GBP/CAD is trending higher in a rising channel, however, it is close to touching the upper trendline of the channel where it is likely to meet firm resistance and will probably pull back down as a consequence.

GBP/CAD is closing in on the upper channel line of a rising channel. It is likely to meet firm resistance at the line and price is diverging bearishly with MACD. GBP/CAD Daily Chart GBP/CAD is showing bearish divergence with the Moving Average Convergence Divergence momentum indicator . This means that although price has risen to a higher high compared to the July 12 high, MACD is actually lower than where it was on July 12.

This is a bearish sign and suggests a higher chance of a pull back evolving. Taken together with the looming overhead channel line it indicates a risk of price correcting back down within the channel. An initial target for a pull back would be the 50-day Simple Moving Average at 1.7733. Price itself has not formed a reversal pattern yet.

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