- USD/CAD holds lower ground nearly weekly bottom, eyes further downside.
- U-turn from 21-DMA, support-turned-resistance line from August favor sellers.
- 100-DMA, 61.8% Fibonacci retracement level lure the bears.
USD/CAD prints a three-day downtrend as it refreshes the weekly low around 1.3330 heading into Thursday’s European session.
In doing so, the Loonie pair justifies the early-week pullback from the 21-DMA, as well as the previous support line from August. Also keeping the USD/CAD pair sellers hopeful are the bearish MACD signals.
With this, the Loonie pair sellers are on their way to the 100-DMA support surrounding 1.3265.
However, the tops marked during early September join the 61.8% Fibonacci retracement level of the pair’s August-October upside to highlight the 1.3200 threshold as a tough nut to crack for the USD/CAD bears.
In a case where the pair breaks the 1.3200 key support, the odds of its slump to the sub-1.3000 region can’t be ruled out.
Alternatively, recovery moves could initially aim for the 21-DMA hurdle surrounding 1.3455 before aiming for the support-turned-resistance line near 1.3490.
Even if the quote remains firmer past 1.3490, the 38.2% Fibonacci retracement level near 1.3500 could challenge the USD/CAD bulls before giving them control.
Overall, USD/CAD is likely to extend the latest weakness but the downside room appears limited.
USD/CAD: Daily chart
Trend: Further downside expected
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