Technical Analysis – USDCAD accelerates to fresh 3-month high

USDCAD gained significant buying traction early on Friday – the largest daily increase since September –, with the price quickly recouping earlier losses to peak above Tuesday’s high of 1.2743.

The positive slope in the RSI and the growing MACD are endorsing the current bullish momentum in the price, though with the former nearing its 70 overbought level and the key ascending line capping the market action, the bears could be around the corner.

A decisive close above the ascending line and the 1.2750 level would reduce negative risks, likely producing another bullish extension towards the key 1.2824 resistance. Beyond that, traders will target the nine-month high of 1.2947, a break of which would re-activate the 2021 uptrend, shifting the medium-term outlook from neutral to positive. Still, any steps higher could be limited if a new barrier pops up near the 1.3000 psychological mark.

Otherwise, if sellers take the lead, the pair may pull back to test the nearby support of 1.2640. Falling lower, the 38.2% Fibonacci retracement of the 1.2006 – 1.2947 upleg may attempt to add some footing around 1.2588, while not far below, the 20-day simple moving average (SMA) could block the way towards the 50% Fibonacci at 1.2477 and the 200-day SMA.

In brief, USDCAD is strengthening its bullish trend in the short-term picture, but the rapid bounce warrants some caution as the price is challenging the crucial boundary set around 1.2750.

Latest News

Technical Analysis – AUDUSD’s bearing in question as gradual ascent struggles

Technical Analysis – Gold sluggish below 1,830 but bullish pressures still alive

Technical Analysis – USDJPY finds foothold on 200-MA, but bearish risks linger

Technical Analysis – US30 index meets support at 200-SMA; bearish forces persist

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.