USD/CAD Technical Analysis: stronger corrective bounce likely

The USD/CAD pair is currently trading at 1.3148 - up 0.6 percent from the three-month low of 1.3068 hit on Feb. 1. 

That corrective bounce could be extended further toward 1.32 in the next day or two, as the hourly chart is reporting a major bullish reversal pattern. 

Hourly chart

• The inverse head-and-shoulders breakout - a transition from the lower highs and lower lows to the higher highs and higher lows - seen in the above chart indicates a bearish-to-bullish trend change. 
• The spot has also found acceptance above the trendline sloping downwards from the Jan. 24 and Jan. 29 highs. 
• The pair, therefore, could extend the corrective bounce to the downward sloping 200-hour moving average (MA), currently at 1.389. 
• A move below 1.3124 would invalidate the bullish setup. 

Trend: Bullish