The US dollar has been considerably bullish against the Canadian dollar over the past two weeks. This has caused the USDCAD pair to record significant upside corrections as the market pierced through the 1.3849 resistance. However, no sooner had that happened, than the market saw a sharp downward correction. Let’s dive in to see what may soon occur in this market.
Key Price Levels:
Resistance Levels: 1.3900, 1.3950, and 1.4000
Support Levels: 1.3800, 1.3750, and 1.3700
USDCAD Sees a Sharp Downward Correction
Price action in the USDCAD daily market sees a considerable trimming of its medium-term gains during yesterday’s trading session. This seems to have been fueled by the alignment of the outcome of the FOMC meeting with prior market anticipations, while the Canadian economy has been seeing some impressive development in recent months.
Be that as it may, trading continues above all the Exponential Moving Average (EMA) lines. Likewise, the Stochastic Relative Strength Index (SRSI) lines have continued to fall sharply towards the 60 level of the indicator. Nevertheless, today’s trading activity has presented only weak resistance to the downward correction. But the question of whether the resistance will stand or not will emerge from US economic data that will surface today.
USDCAD Consolidates Above the 50-Day EMA Curve
Price activity in the USDCAD daily market can be seen consolidating above the 50-day EMA lines. This occurred after the market fell below the 20-day EMA line. The corresponding price candle to the ongoing session has arrived as a bearish one. Nevertheless, the support seen at the 50-day EMA line holds.
At the same time, the SRSI indicator lines can be seen deep in the oversold region of the indicator. The consolidating move occurring in recent sessions suggests that the support at 1.3800 may be strong enough to hold downward forces. However, traders should keep an eye out for fundamentals that may guide an upside rebound towards the 1.3850 mark.
Do you want to take your trading to the next level? Join the best platform for that here.
Leave a Reply