USD/CAD Price Analysis: Loonie buyers flex muscles below 1.3500 as Canada, US data looms
- USDCAD stays depressed after snapping two-day winning streak, reversing from 50-DMA.
- Failure to stay beyond 50-DMA, two-month-old descending resistance line keeps Loonie pair sellers hopeful despite sluggish MACD signals.
- Rising support line from early February restricts immediate downside; Bulls need validation from April’s peak.
USD/CAD bears flirt with the 200-DMA surrounding 1.3465 as they take a breather after the Loonie pair’s biggest daily fall in over a week, especially on the release day of the US Retail Sales and Canada inflation data.
Also read: USD/CAD dives as the Canadian Dollar rides on higher oil prices, soft USD
The Loonie pair reversed from the 50-DMA the previous day to snap a two-day uptrend. The pair’s following declines, however, failed to gain support from the MACD and hence the USD/CAD bears struggle near the 200-DMA support near 1.3465-60 by the press time.
Even if the quote breaks the 200-DMA key support, an upward-sloping support line from early February, close to 1.3365 by the press time. It’s worth noting that the 1.3400 round figure may act as an intermediate halt between the key DMA and the stated support line.
In a case where the USD/CAD bears keep the reins past 1.3365, the odds of witnessing a slump toward the yearly low marked in February near 1.3260 can’t be ruled out. Though, lows marked in April and mid-February, near 1.3340 and 1.3270 respectively, may prod the pair sellers.
On the flip side, the USD/CAD pair’s recovery can aim for the 50-DMA hurdle of around 1.3560 ahead of challenging a 10-week-old descending resistance line, close to 1.3585 by the press time.
Should the quote remains firmer past 1.3585, the previous monthly high of near 1.3665 will be crucial for the Loonie pair buyers before targeting the late March swing high of 1.3805.
USD/CAD: Daily chart
Trend: Further downside expected
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.
