The USDCAD pair saw a moderate downward retracement as the US Consumer Price Index (CPI) figures were released. While the CPI was broadly in line with expectations, the annual core CPI rose by 0.3%, exceeding the anticipated and previous 0.2%. This caused the market to retreat and currently seems to be heading toward a nearby support level.
Key Price Levels:
Resistance Levels: 1.3600, 1.3700, 1.3800
Support Levels: 1.3500, 1.3400, 1.3300
USDCAD Price Action Is Retracing Below Important Marks
Price action in the USDCAD daily market had earlier rebounded upwards off the support level at 1.3444. The market progressed upwards but retraced in the ongoing session. The corresponding price candle has fallen below 7 out of 12 Guppy Multiple Moving Average (GMMA) lines.
Although it may be early to conclude, it appears that downward forces are gaining momentum. The Stochastic Relative Strength Index (Stochastic RSI) lines have also delivered a downward crossover in the overbought region. Consequently, this signals that headwinds may gain prominence and cause further price declines.
Headwinds in the USDCAD Market Seem Ready to Persist
On the USDCAD 4-hour market, price activity has been trending toward lower levels, as indicated by the frequent appearance of red price candles over the past four sessions. The latest price candle, however, suggests that bears are maintaining control.
At this point, the market seems to be heading toward the red set of the GMMA indicator lines. Similarly, the Stochastic RSI lines are still trending downward into the oversold region. Given the overall market sentiment, it appears that price action may head toward the next psychological support level at 1.3550.
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