USD/CAD Price Analysis: Keeps bounce off 1.2770 key support
- USD/CAD holds onto the previous day’s rebound from three-week low, sidelined of late.
- 200-SMA, monthly support line and 50% Fibonacci retracement constitute strong support, 100-SMA guards recovery moves.
- Steady RSI suggests further grinding towards the south.
USD/CAD defends the bounce off the 1.2770 key support, taking rounds to 1.2815-20 during Wednesday’s Asian session. In doing so, the Loonie pair seesaws between the 100-SMA and 200-SMA amid steady RSI conditions.
Hence, the quote is likely to remain sidelined until either breaking the 100-SMA level of 1.2880 or the 1.2770 support confluence including the 200-SMA, together with the one-month-old ascending trend line and 50% Fibonacci retracement of April 21 to May 12 upside.
Even if the USD/CAD prices manage to cross the 110-pip trading range, a three-week-old horizontal area and 61.8% Fibo. will challenge the momentum around 1.2920 and 1.2685 in that order.
It’s worth noting that the quote’s moves past the aforementioned range are likely to create havoc.
That said, the nearly two-week-long consolidation of gains and the recent US dollar weakness suggest short-term favor to the bears. However, a clear downside break of the 1.2685 support seems less likely.
On the contrary, an upside break of the 1.2920 hurdle won’t hesitate to renew the monthly peak, around 1.3080 by the press time.
USD/CAD: Four-hour chart
Trend: Sideways
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
