USDCAD falls after better than expected Canadian inflation numbers; reversal pattern is forming on daily chart

Loonie jumped around 100 pips against its US counterpart after Canadian inflation surprised in January, coming well above forecast.
Underlying inflation firmed in January while annualized CPI rose by 1.7%, pulling back from previous month’s 1.9% figure, but overshooting forecast at 1.4%.
January’s easing comes from lower prices of gasoline and motor vehicles which offset higher cost of food.
Overall signal from today’s release was positive despite the inflation moved away from BoC’s 2% target in Jan.
USDCAD moved lower after repeated failure to clear falling 200SMA (1.2710) which was cracked on yesterday’s spike to 1.2757, but the pair failed to sustain break and closed below 200SMA.
Fresh weakness also broken deeply into daily cloud (post-data low is at 1.2610 while cloud base lies at 1.2637) but penetration proved to be short-lived, as the price bounced back above the cloud.
However, fresh weakness today is on track to complete Doji reversal pattern on daily chart which could spark further weakness.
The notion is supported by overbought slow stochastic which turned south and is about to emerge from overbought territory, while recent strong bullish momentum is fading.
Bearish close today will be initial bearish signal which would be boosted on close below daily cloud top (also Fibo 38.2% of 1.2450/1.2757 upleg) with further bearish signal on extension through daily Tenkan-sen (1.2603) while return below daily cloud (base lies at 1.2556) is needed to confirm reversal.
Alternative scenario requires close above 200SMA to neutralize and shift focus higher.

Res: 1.2685; 1.2710; 1.2725; 1.2757
Sup: 1.2637; 1.2603; 1.2567; 1.2556