USD/CAD Price Analysis: Attempts to come out of woods

USD/CAD rebounds after building a base around 1.3400 as the market mood turns cautious.
US headline inflation for July is expected to rebound as oil prices recovered sharply last month.
USD/CAD shifts auction above the 1.3387 resistance, which turns into a support for the US Dollar bulls.

Sagar Dua FXStreet

The USD/CAD pair attempts to break the consolidation above the round-level support of 1.3400 in the European session. The Loonie asset finds strength as the US Dollar rebounds after discovering a cushion near 102.30.

Bearish sentiment revives as investors turn cautious ahead of the United States inflation data, which will be released on Thursday at 12:30 GMT. US headline inflation for July is expected to rebound as oil prices recovered sharply last month.

July’s inflation data is expected to build a base for Federal Reserve’s (Fed) September monetary policy as sticky price pressures would force policymakers to consider an extension of policy-tightening.

USD/CAD shifts auction above the horizontal resistance plotted from July 07 high at 1.3387 on a four-hour scale, which turns into a support for the US Dollar bulls. The Loonie asset is approaching the next resistance plotted around 1.3650. Upward-sloping 20-period Exponential Moving Average (EMA) at 1.3400 provides support to the US Dollar.

The Relative Strength Index (RSI) (14) oscillates in a 40.00-60.00 range, which indicates a consolidation ahead.

Mean-reversion move to near 1.3400 would be a buying opportunity for the US Dollar bulls. This would drive the asset toward June 05 high at 1.3462 followed by the psychological resistance at 1.3500.

In an alternate scenario, a downside move below July 18 high at 1.3288 would drag the asset toward July 27 low around 1.3160 and July 14 low marginally below 1.3100.

USD/CAD four-hour chart

USD/CAD

Overview
Today last price	1.3445
Today Daily Change	0.0026
Today Daily Change %	0.19
Today daily open	1.3419

Trends
Daily SMA20	1.324
Daily SMA50	1.3271
Daily SMA100	1.3396
Daily SMA200	1.3454

Levels
Previous Daily High	1.3502
Previous Daily Low	1.3365
Previous Weekly High	1.3394
Previous Weekly Low	1.3151
Previous Monthly High	1.3387
Previous Monthly Low	1.3093
Daily Fibonacci 38.2%	1.345
Daily Fibonacci 61.8%	1.3417
Daily Pivot Point S1	1.3355
Daily Pivot Point S2	1.3292
Daily Pivot Point S3	1.3218
Daily Pivot Point R1	1.3492
Daily Pivot Point R2	1.3566
Daily Pivot Point R3	1.3629

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

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