USD/CAD Price Analysis: Climbs further beyond mid-1.2300s, fresh session tops

USD/CAD gained some positive traction on Monday and recovered a part of the post-NFP losses.
The emergence of dip-buying favours bullish traders and supports prospects for additional gains.

Haresh Menghani FXStreet

The USD/CAD pair maintained its bid tone heading into the North American session and was last seen hovering near the top end of its daily trading range, above mid-1.2300s.

That said, an unexpected rise in the US unemployment rate might have dashed hopes for an earlier than anticipated monetary policy tightening by the Fed. This, in turn, acted as a headwind for the US dollar and capped gains for the USD/CAD pair. Bulls also seemed reluctant to place any aggressive bets ahead of the crucial OPEC+ meeting on Monday.

From a technical perspective, the emergence of some dip-buying on the first day of a new trading week assisted the USD/CAD pair to stall its post-NFP pullback from a short-term descending trend-line. The mentioned trend-line has been capping the upside since the beginning of 2021 and should now act as a key pivotal point for short-term traders.

In the meantime, the 100-day SMA, currently around the 1.2385 region, might act as immediate resistance. This is closely followed by the 1.2400 mark, above which the USD/CAD pair seems all set to climb back to challenge the trendline hurdle, around mid-1.2400s. A convincing breakthrough will be seen as a fresh trigger for bullish traders.

On the flip side, the 1.2310-1.2300 area now seems to have emerged as immediate strong support. Sustained weakness below might prompt some technical selling and drag the USD/CAD pair back towards last week's swing lows support, around mid-1.2200s. Some follow-through selling could shift the near-term bias back in favour of bearish traders.

The next relevant support is pegged near the 1.2200 mark ahead of the ahead of strong horizontal resistance breakpoint near the 1.2160-50 area. This should act as a strong base for the USD/CAD pair, which if broken decisively will negate prospects for any further gains.

USD/CAD daily chart

Technical levels to watch

USD/CAD

Overview
Today last price	1.2358
Today Daily Change	0.0038
Today Daily Change %	0.31
Today daily open	1.232

Trends
Daily SMA20	1.2273
Daily SMA50	1.2201
Daily SMA100	1.2388
Daily SMA200	1.2667

Levels
Previous Daily High	1.245
Previous Daily Low	1.2309
Previous Weekly High	1.245
Previous Weekly Low	1.2288
Previous Monthly High	1.2487
Previous Monthly Low	1.2007
Daily Fibonacci 38.2%	1.2363
Daily Fibonacci 61.8%	1.2396
Daily Pivot Point S1	1.227
Daily Pivot Point S2	1.2219
Daily Pivot Point S3	1.2129
Daily Pivot Point R1	1.241
Daily Pivot Point R2	1.25
Daily Pivot Point R3	1.2551

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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