- USD/CAD rises above the 200-day EMA but struggles to crack 1.3400.
- Upside risks for the USD/CAD lie above 1.3400, which can trigger a rally toward 1.3500.
- USD/CAD failure to crack 1.3400 could pave the way for further losses.
The USD/CAD advances after bottoming last Friday at around 1.3300; the pair bounces off and hovers nearby the 1.3400 figure after reaching a high of 1.3420. At the time of writing, the USD/CAD is trading at 1.3395 and is gaining 0.31%.
The USD/CAD dove to new 8-week lows at 1.3300, spurring an increase in the greenback’s demand, even though the Bank of Canada (BoC), in its latest monetary policy, announced the BoC Governing Council discussed raising rates. Nevertheless, current expectations for additional Fed tightening bolstered the US Dollar.
USD/CAD Price Action
Given the backdrop, the USD/CAD is still neutral to downward biased, but it’s testing the upper boundaries of the 200-day Exponential Moving Average (EMA) at 1.3377. In addition, a daily close of the USD/CAD pair above the latter could exacerbate another leg-up in the pair, initially towards a downslope resistance trendline drawn from November 2022 highs that pass around the 1.3430-50 area. But firstly, the USD/CAD buyers need to reclaim 1.3400.
If USD/CAD cracks the 1.3400 figure, the next resistance would be the trendline mentioned above at 1.3430-50. Once cleared, the USD/CAD could threaten the confluence of the 20 and 100-day EMAs, around 1.3497-1.3504, before rallying towards the 50-day EMA At 1.3534.
Conversely, if USD/CAD stays below 1.3400, that could open the door for further downside. That said, the first support would be the 200-day EMA at 1.3377, followed by the April 17 low at 1.3342, before aiming toward the 1.3300 figure.
USD/CAD Daily Chart
USD/CAD Technical Levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds steady near 1.0650 amid risk reset
EUR/USD is holding onto its recovery mode near 1.0650 in European trading on Friday. A recovery in risk sentiment is helping the pair, as the safe-haven US Dollar pares gains. Earlier today, reports of an Israeli strike inside Iran spooked markets.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD is rebounding toward 1.2450 in early Europe on Friday, having tested 1.2400 after the UK Retail Sales volumes stagnated again in March, The pair recovers in tandem with risk sentiment, as traders take account of the likely Israel's missile strikes on Iran.
Gold price defends gains below $2,400 as geopolitical risks linger
Gold price is trading below $2,400 in European trading on Friday, holding its retreat from a fresh five-day high of $2,418. Despite the pullback, Gold price remains on track to book the fifth weekly gain in a row, supported by lingering Middle East geopolitical risks.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Geopolitics once again take centre stage, as UK Retail Sales wither
Nearly a week to the day when Iran sent drones and missiles into Israel, Israel has retaliated and sent a missile into Iran. The initial reports caused a large uptick in the oil price.