USD/CAD Price Analysis: Bulls flirt with 200-DMA/ascending trend-line confluence breakpoint

A combination of supporting factors assisted USD/CAD to regain positive traction on Monday.
Sliding crude oil prices undermined the loonie and extended support amid modest USD strength.
The technical set-up favours bullish traders and supports prospects for additional near-term gains.

Haresh Menghani FXStreet

The USD/CAD pair held on to its strong intraday gains through the early North American session and was last seen trading around the 1.2610 region, near the multi-week high touched on Friday.

Crude oil prices dropped to the lowest level since March 17 and undermined the commodity-linked loonie. This, in turn, was seen as a key factor that offered some support to the USD/CAD pair amid the underlying bullish sentiment surrounding the US dollar. Despite the supporting factors, bulls, so far, have struggled to make it through the very important 200-day SMA. The said barrier has been capping the USD/CAD pair over the past three trading sessions and coincides with a descending tren-line support breakpoint.

Oscillators on the daily chart have just started gaining positive traction and support prospects for an eventual breakout through the aforementioned confluence. The USD/CAD pair could then climb to mid-1.2600s, or the 50% Fibonacci level of the 1.2901-1.2403 fall. Some follow-through buying will suggest that the USD/CAD pair has formed a temporary bottom near the 1.2400 mark and pave the way for additional gains. The momentum could then push spot prices towards the 1.2700 mark en-route the 61.8% Fibo. level, around the 1.2715 region.

On the flip side, the 1.2555 region now seems to protect the immediate downside ahead of the 23.6% Fibo. level, around the 1.2525 region. A convincing breakthrough, leading to subsequent weakness below the 1.2500 psychological mark, will shift the bias in favour of bearish traders. The USD/CAD pair would then turn vulnerable to slide back to challenge the YTD low, around the 1.2400 mark, with some intermediate support near the 1.2465 zone.

USD/CAD daily chart

Key levels to watch

USD/CAD

Overview
Today last price	1.2615
Today Daily Change	0.0045
Today Daily Change %	0.36
Today daily open	1.257

Trends
Daily SMA20	1.2571
Daily SMA50	1.2666
Daily SMA100	1.2691
Daily SMA200	1.2622

Levels
Previous Daily High	1.2619
Previous Daily Low	1.2565
Previous Weekly High	1.2619
Previous Weekly Low	1.2403
Previous Monthly High	1.2901
Previous Monthly Low	1.243
Daily Fibonacci 38.2%	1.2586
Daily Fibonacci 61.8%	1.2598
Daily Pivot Point S1	1.255
Daily Pivot Point S2	1.253
Daily Pivot Point S3	1.2496
Daily Pivot Point R1	1.2605
Daily Pivot Point R2	1.2639
Daily Pivot Point R3	1.2659

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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