-
USDCAD meets long-term support trendline near 1.3810.
-
Technical indicators reflect easing selling interest.
-
A decisive move above EMAs needed to shift outlook.
USDCAD saw limited movement throughout the week and is currently heading for a second consecutive neutral close.
However, the sideways trajectory in the price, combined with oversold signals from the RSI and stochastic oscillator, increases speculation that the recent downtrend may have reached a bottom.
Indeed, the price is hovering near the 1.3810 support region from November 6 and around the ascending trendline drawn from the May 2021 low, making a rebound likely. However, for a meaningful recovery, the bulls will need to push above the broad neutral zone at 1.3950 and break through the 20-day exponential moving average (EMA). The 200- and 50-day EMAs could also present resistance near 1.4055 and 1.4120, respectively. A successful breakout could breathe life back into the pair, potentially boosting buying interest toward the 1.4270 resistance zone, while higher, the spotlight may shift to the crucial barrier at 1.4400–1.4470.
In the bearish scenario, where the price retreats below the support trendline near 1.3790, the 78.2% Fibonacci retracement of the September–February rally at 1.3720 could offer temporary relief. Failing that, the sell-off could accelerate toward the 1.3620 support area, which was the neckline of the double bottom pattern formed last September. A break below that level could trigger stronger selling pressure.
In brief, USDCAD has reached an ideal area for a bullish reversal. However, only a rally above the exponential moving averages and beyond the 1.4100 mark would be sufficient to eliminate downside risks.
Note that Canada is heading to the polls on Monday April 28 to decide whether Prime Minister Mark Carney's Liberal Party will stay in power.
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
AUD/USD: Consolidation seems the name of the game
AUD/USD came under further downside pressure on Thursday, adding to Wednesday’s retracement and briefly dipping below the key support at 0.6400 the figure. The pair’s pullback came despite decent losses in the Greenback and firmer Australian labour market report.
EUR/USD: Door open to further weakness
EUR/USD is starting to feel heavy, with growing concern that more downside could be just around the corner. The pair has struggled to hold onto any bullish momentum and has been steadily drifting lower since hitting yearly highs near 1.1570 in late April.
Gold hovers around $3,200 amid tepid buying
Gold kept up its bullish momentum on Thursday, climbing to fresh daily highs above the key $3,200 mark per troy ounce. The move is getting a boost from a softer Greenback and a generally cautious mood in global markets, while the initial excitement around the US–China trade deal continues to fade.
Crypto Today: SOL, XRP and ADA in danger zone as Bitcoin price anchors market above $3.4 trillion
The cryptocurrency sector declined 4% on Thursday, with aggregate market capitalization hovering precariously above the $3.4 trillion mark. Top altcoins XRP, Solana and Cardano booked losses higher than the market average, with the more resilient performance of BTC and ETH signaled a flight-to-quality trade.
Why the UK’s first quarter growth surge looks strange
The UK economy roared back to life in the first quarter after stagnating through the second half of last year. Or did it? We're not sure the data is an accurate guide to what's going on beneath the surface.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.