USDCAD is consolidating across the 1.2300 handle after the price slipped back below the Ichimoku cloud and the simple moving averages (SMAs) over a period of one-month. The bullish bearing of the 50- and 100-day SMAs has softened, as has the negative tone of the 200-day SMA, overall signalling that the pair may adopt a more neutral form.
The Ichimoku lines are indicating a pause in downward forces, while the short-term oscillators are conveying conflicting signals in directional momentum. The MACD, some distance below zero, is edging towards its red trigger line, while the RSI’s recent rebound at the 30 level is struggling to make headways. On the other hand, the stochastic oscillator is promoting positive price action, as its bullish charge remains intact.
In the positive scenario, prompt upside constraints could commence from the resistance section of 1.2383-1.2425. Overstepping this barrier, the price may then encounter a zone of resistance between the 200- and 100-day SMA at 1.2488 and 1.2515 respectively. Successfully conquering this too, the bulls could then target the 50-day SMA at 1.2595 ahead of the 1.2647 high.
Alternatively, if negative pressures pick up again, initial support could transpire from the immediate 1.2251-1.2308 region. Diving beneath this zone, which was formed by the lows around the end of June until early July, the pair may meet the 1.2200 handle. Should the round number fail to dismiss further downward pressures, sellers could then turn their focus towards the 1.2127 and 1.2057 lows.
Summarizing, USDCAD’s price outlook remains skewed to the downside. Price action is currently confined between the 1.2251-1.2308 lower limit and the 1.2383-1.2425 upper limit. A clearer price direction could evolve should the pair break either below or above these limits.
Forex trading and trading in other leveraged products involves a significant level of risk and is not suitable for all investors.
Recommended Content
Editors’ Picks
EUR/USD trades weak below 1.0800 amid Good Friday lull, ahead of US PCE
EUR/USD remains depressed below 1.0800 after soft French inflation data, amid minimal volatility and thin liquidity on Good Friday. The pair keenly awaits the US PCE inflation data and Fed Chair Powell's speech for fresh hints on next week's price action.
GBP/USD holds steady above 1.2600 as markets stay calm on Good Friday
GBP/USD trades sideways above 1.2600 amid a typical Good Friday trading lull. A broadly firmer US Dollar could keep any upside attempts limited in the pair ahead of the US PCE inflation data and Fed Chair Powell's appearance.
Gold reaches to all-time highs near $2,230, US PCE eyed
Gold price appreciates to all-time highs near $2,230 per troy ounce, attempting to continue its winning streak for the fifth successive session on Friday. However, trading volumes are light as market participants are likely observing Good Friday.
Jito price could hit $6 as JTO coils up inside this bullish pattern
Jito (JTO) price has been on an uptrend since forming a local bottom in early January. Since then, JTO has revisited the key swing point formed in early December, suggesting the bulls’ intention to move higher.
Key events in developed markets next week
Next week, the main focus will be inflation and the labour market in the Eurozone. We expect services inflation to be impacted by the easter effect, while the unemployment rate to be unchanged.