USD/CAD Price Analysis: The critical support zone is located at the 1.3495-1.3500 region
|- USD/CAD loses momentum for two days in a row amid the USD weakness.
- The pair holds below the key 100-hour Exponential Moving Average (EMA) on the one-hour chart.
- The first resistance level to watch is 1.3535; the critical support zone is located at the 1.3495-1.3500 region.
The USD/CAD pair trades in negative territory for the second consecutive day. The Greenback declined against its rivals due to the downbeat US PMI data and a decline in US Treasury yields. The pair currently trades near 1.3527, up 0.01% for the day.
That said, Business activity in the United States in August expanded at a slow pace. The preliminary S&P Global Composite PMI decreased to 50.4, down from 52.0 previously and below market expectations of 52.0. This is the largest decrease since November 2022. Meanwhile, US Treasury yields retreated from multi-year highs and declines below 4.20%.
From the technical perspective, USD/CAD holds below the 100-hour Exponential Moving Average (EMA), which means further downside looks favorable for the major pair. Meanwhile, the Relative Strength Index (RSI) stands below 50, activating the bearish momentum for the USD/CAD pair for the time being.
Any follow-through buying above 1.3535 will be exposed to further upside. The mentioned level is a confluence of the middle line of the Bollinger Band and the 100-hour EMA. The next upside stop is located at 1.3575 (high of August 18, the upper boundary of the Bollinger Band), followed by a psychological figure at 1.3600. Further north, the pair will see a rally to 1.3650 (a high of May 31).
On the downside, the critical support zone for USD/CAD is located at the 1.3495-1.3500 region, portraying a psychological round figure and the lower limit of the Bollinger Band. The additional downside filter to watch is 1.3475 (Low of August 16) en route to 1.3445 (Low of August 15) and finally at 1.3410 (Low of August 11).
USD/CAD one-hour chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.