The long-anticipated Federal Reserve interest rate cut has arrived, and it has emerged in line with market expectations. Nevertheless, the USDCAD seems to be largely sticking to its upward path. However, a more careful examination of price action may be needed before making bullish decisions in this market.
Key Price Levels:
Resistance Levels: 1.3700, 1.3750, 1.3800
Support Levels: 1.3650, 1.3600, 1.3550
USDCAD Price Movement May Still March Higher
Price movement in the USDCAD appears to have healthy volatility. The market seems to have capitalized on this today and has used it to rise through some key landmarks. However, considering the appearance of the last price candle, it could be seen that the interplay between market anticipations of the Fed’s rate cut has brought some tension to today’s trading activity.
Be that as it may, the last price candle still places the pair above all the Guppy Multiple Moving Average (GMMA) lines. Meanwhile, the Stochastic Relative Strength Index (Stochastic RSI) lines are showing an upside crossover at the 80 mark of the indicator. Technically, this suggests that upside forces may still be actively pushing prices.
Is the Dovish Interest Rate Already Influencing the USDCAD Market?
While price activity in the USDCAD 4-hour market remains above all the GMMA indicator lines, it can be seen that the ongoing session has experienced a downward retracement. This has caused the market to test the GMMA lines as a support level. Additionally, the longer lower shadow of the last price candle indicates that downward forces are attempting to wear out the upside momentum as the market contracts upwards instead of progressing upward.
Nevertheless, price action remains above all the GMMA lines. As a result, the upside forces have the chance to regain control of price movement. The Stochastic RSI curves are in the overbought region, but the leading line reflects the price’s downward retracement. Therefore, traders may look to the Canadian dollar for direction towards the 1.3650 level.
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