USD/CAD‘s Sixth Consecutive Weekly Gain
The USD/CAD pair continues its upward trajectory, marking the sixth consecutive week of gains and edging closer to 1.3480 during the European session on Monday. The psychological resistance at 1.3500 looms as the immediate hurdle, with the potential for a positive sentiment if breached.
Technical Analysis Signals Bullish Momentum
Technical analysis, specifically the Moving Average Convergence Divergence (MACD), suggests a potential bullish sentiment. The positioning of the MACD line above the centerline and divergence above the signal line indicates positive momentum. Moreover, the 14-day Relative Strength Index (RSI) supports this interpretation, positioned above 50, confirming stronger momentum and potentially aiding the pair in navigating the region around the psychological resistance of 1.3600.
Key Levels to Watch
A successful breakthrough above the psychological resistance at 1.3500 could propel the USD/CAD pair to test January’s high at 1.3541 before encountering the major support at the 1.3550 level. On the downside, the pair may find support around the 50-day Exponential Moving Average (EMA) at 1.3456, with additional support at the 23.6% Fibonacci retracement level at 1.3455 and the major support at 1.3450.
Potential Downside Scenarios
A breach below the 1.3450 support level could lead to downward pressure on the USD/CAD pair, testing the 38.2% Fibonacci retracement level at 1.3402. Further downside could see the pair targeting the psychological level at 1.3400 and revisiting the recent low at 1.3365, recorded on February 2. Traders are keenly observing these levels for potential shifts in market dynamics.
