- USD/CAD retraces to the multi-tested descending trendline.
- USD/CAD under pressure despite falling oil prices.
- The expectation for 25 bps is rising for the Fed meeting.
USD/CAD is sliding downward, supported by a descending trend line that starts from the March high at the 1.3862 level on the daily timeframe. Since last week, the broad-based US Dollar weakness has kept USD/CAD under pressure despite falling oil prices.
Maintaining a downside bias for USD/CAD, the pair finds support on the 21-Daily Moving Average (DMA) just above the previous day's low at 1.3644. Upon a convincing break of the 21-DMA and the previous day's low, the pair will likely head toward the key support level and round figure mark of 1.3600.
The last support area will be the 50-DMA, currently pegged around the 1.3500 critical psychological level.
The pair finds resistance at the downward-sloping trendline, and a break above would take USD/CAD toward the 1.3800 mark, followed by the March high. The last known resistance is a multi-year high around the 1.4000 mark. The Relative Strength Index (RSI) signals lower lows, suggesting further downside room for the pair.
USD/CAD quietly awaits the upcoming Federal Reserve (Fed) policy decision for the following directional clues. Any bearish development for the pair from the Fed will likely pave the way for the 50-DMA.
USD/CAD: Daily chart