USD/CAD Price Analysis: Advances towards 1.3000 on symmetrical triangle breakout
|- A symmetrical triangle breakout has strengthened the greenback bulls for an upside move towards 1.3000.
- The formation of positive divergence on the RSI (14) has confirmed a bullish reversal.
- The greenback bulls have surpassed the 50-EMA which confirms a short-term uptrend.
The USD/CAD pair has overstepped the crucial hurdle of 1.2963 firmly in the Asian session. The asset is scaling higher strongly after sensing a responsive buying action below 1.2920. A corrective move in the asset after printing a monthly high of 1.3079 on Friday is expected to convert into a fresh impulsive move.
An upside break of the Symmetrical Triangle has strengthened the greenback bulls. The downward sloping trendline of the above-mentioned chart pattern is placed from Friday’s high at 1.3079 while the other is plotted from Thursday’s low at 1.2861.
The asset has recaptured the 50-period Exponential Moving Average (EMA) at 1.2953, which signifies that the short-term trend is hinting at an upside movement. Also, the 200-EMA at 1.2898 is scaling higher, which confirms that the long-term trend is intact.
A Positive Divergence was recorded after the asset made a higher low at around 1.2907 while the momentum oscillator Relative Strength Index (RSI) (14) made a lower low. This dictates an oversold situation in an uptrend and indicates a fresh leg of rally going forward. Meanwhile, the RSI (14) has crossed 60.00, which put the greenback bulls in a dominant position.
A pullback move towards the 50-period EMA at 1.2953 will be an optimal buy for the bargain investors, which will drive the asset towards the psychological resistance and Friday’s high at 1.3000 and 1.3079 respectively.
Alternatively, the Positive Divergence formation could negate if the asset drops below Thursday’s low at 1.2861. This will drag the asset towards June 10 high at 1.2813, followed by May 23 low at 1.2766.
USD/CAD hourly chart
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