- USD/CAD extends the previous day’s pullback from 29-month high, pokes 50-SMA of late.
- Bearish MACD signals, sustained break of an ascending trend line from September 13 keeps sellers hopeful.
- Buyers need to provide a daily close beyond 1.3865 to retake control.
USD/CAD takes offers to refresh intraday low around 1.3710 during early Friday morning in Europe. In doing so, the Loonie pair stretches Thursday’s losses while poking the 50-SMA support.
It’s worth noting, however, that the bearish MACD signals and the pair’s sustained downside break of the one-month-old ascending trend line favor sellers of late.
With this, the USD/CAD bears are on the way to an upward-sloping support line from September 14, near 0.9670, a break of which will make the quote vulnerable to refresh the monthly low, currently around 1.3500.
Alternatively, recovery moves need to cross the previous support line from mid-September, close to 1.3745 at the latest.
Even so, a 12-day-old ascending resistance line of around 1.3865 could challenge the USD/CAD buyers.
Following that, a run-up towards the latest swing high near 1.3980 and then to the 1.4000 psychological magnet can’t be ruled out.
Overall, USD/CAD is likely to witness further downside but the bullish trend is far from reversing.
USD/CAD: Four-hour chart
Trend: Further weakness expected
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