- USD/CAD pauses two-day uptrend near the highest levels in three weeks.
- Bullish MACD signals, sustained break of 200-SMA keep buyers hopeful.
- Weekly ascending trend line acts as the key short-term support.
USD/CAD retreats from a three-week high to 1.2736 during a quiet Asian session on Friday. In doing so, the Loonie pair drops for the first time in three days while stepping back from a one-month-old descending resistance line.
Even so, the quote’s successful trading above the 1.2695-2710 support zone, comprising 200-SMA and 50% Fibonacci retracement (Fibo.) of December-January declines, keeps USD/CAD buyers hopeful amid bullish MACD signals.
It’s worth noting that 61.8% Fibo. level near 1.2770 acts as an additional upside hurdle, should the quote manage to cross the immediate trend line barrier around 1.2750.
In a case where USD/CAD manages to stay firmer past 1.2770, the monthly high of 1.2813 and the late December tops close to 1.2850 will test the further advances before directing the quote towards the last month’s peak of 1.2964.
On the flip side, short-term sellers will gain momentum on the break of 1.2695. However, an ascending support line from January 20, near 1.2595, will challenge the USD/CAD sellers afterward.
If at all the USD/CAD bears conquer the 1.2595 support, the 23.6% Fibonacci retracement level of 1.2571 may offer an intermediate halt during the anticipated fall towards the monthly low of 1.2450.
USD/CAD: Four-hour chart
Trend: Further upside expected
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