USD/CAD Price Analysis: Refreshes weekly low and rebounds, back above 1.2800 mark

USD/CAD witnessed some intraday selling on Friday and dropped to a fresh weekly low.
The ascending channel formation supports prospects for the emergence of dip-buying.
A convincing break below the 1.2740-35 area is needed to negate the positive outlook.

Haresh Menghani FXStreet

The USD/CAD pair struggled to capitalize on its modest intraday gains, instead met with a fresh supply near the 1.2835 region on Friday and refreshed weekly low during the mid-European session. The pair, however, quickly reversed the dip and jumped back above the 1.2800 round-figure mark in the last hour.

Looking at the broader picture, the USD/CAD pair has been trending higher along an ascending channel over the past two months or so, pointing to a short-term uptrend. Apart from this, oscillators on the daily chart – though have been losing traction – are still holding in the positive territory and favour bullish traders.

This, in turn, supports prospects for the emergence of some dip-buying at lower levels. Hence, any subsequent weakness below the 1.2770-60 horizontal support is more likely to stall near the lower boundary of the mentioned channel, currently around the 1.2740 region, which should now act as a key pivotal point.

A convincing break below will negate any near-term positive bias and pave the way for an extension of the recent pullback from the YTD high touched on Monday. The USD/CAD pair would then turn vulnerable to break below the 1.2700 mark and accelerate the fall towards testing the next relevant support near the 1.2640-35 region.

On the flip side, momentum beyond the daily swing high, around the 1.2835 region, might confront some resistance near the 1.2860 area. Some follow-through buying will reaffirm the bullish outlook and allow the USD/CAD pair to reclaim the 1.2900 mark. The momentum could further push spot prices to the 1.2960-65 area, or the YTD top.

USD/CAD daily chart

Technical levels to watch

USD/CAD

Overview
Today last price	1.2813
Today Daily Change	0.0009
Today Daily Change %	0.07
Today daily open	1.2804

Trends
Daily SMA20	1.2798
Daily SMA50	1.2604
Daily SMA100	1.2613
Daily SMA200	1.2492

Levels
Previous Daily High	1.2854
Previous Daily Low	1.2798
Previous Weekly High	1.2937
Previous Weekly Low	1.2706
Previous Monthly High	1.2837
Previous Monthly Low	1.2352
Daily Fibonacci 38.2%	1.2819
Daily Fibonacci 61.8%	1.2832
Daily Pivot Point S1	1.2783
Daily Pivot Point S2	1.2763
Daily Pivot Point S3	1.2728
Daily Pivot Point R1	1.2839
Daily Pivot Point R2	1.2874
Daily Pivot Point R3	1.2895

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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