Today during the Asian session, the USD/CAD pair grows moderately, recovering from Monday's decline, which did not allow it to renew local highs.

The USD/CAD pair reached the key support level of 1.2510, from which there was a price reversal in 2016 and 2018. 

The pair may fall.

On the daily chart, the downward wave of the higher level (C) of 4 develops, within which the fifth wave 5 of (C) forms. Now, the third wave of the lower level iii of 5 has formed, a local correction has formed as the wave iv of 5, and the wave v of 5 is developing. If the assumption is correct, the pair will fall to the levels of 1.2450–1.2300. In this scenario, critical stop loss level is 1.2750.

The USD/CAD pair is showing a downtrend, trading at 1.2587. USD is declining along with the USD Index, which dropped to its January 2021 lows at 90 points. Analysts fear that a drop below this level could mean the beginning of prolonged stagnation.