USD/CAD technical analysis: Retakes 1.33, still trapped in an ascending triangle

USD/CAD is better bid at press time but is still stuck in an ascending triangle on the 4-hour chart.
A triangle breakout would signal a resumption of the rally from July lows.

Omkar Godbole FXStreet Contributor

USD/CAD has added more than 15 pips in the last sixty minutes and is currently trading at 1.3310, having carved out a bullish higher low of 1.3249 earlier this week.

The outlook, however, remains neutral as the pair is still trapped in an ascending triangle as seen on the 4-hour chart.

Ascending triangles usually end up accelerating the preceding bullish move. So, a breakout, if confirmed, would signal a resumption of the rally from the July 19 low of 1.3016 and open the doors to 1.3432 (June 18 high).

Meanwhile, the triangle breakdown would imply n end of the rally from the July 19 low of 1.3016.

As of writing, the upper edge of the ascending triangle is located at 1.3345 and the support is seen a 1.3269.

The breakout could happen later today if Federal Reserve's President Powell again dashes hopes of an aggressive easing in the near-term. Powell cut rates last month by 25 basis points, as expected, but refrained from signaling further easing.

His non-committal stance was validated by the minutes released Wednesday, which showed the officials were reluctant to start a full-blown easing cycle.

Daily chart

Trend: Neutral

Pivot points

1. R3 1.3364
2. R2 1.334
3. R1 1.3322
PP 1.3299
1. S1 1.3281
2. S2 1.3257
3. S3 1.324

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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