USD/CAD bulls still in play; need to crawl above 1.3340.
In the fifth consecutive week of having risen, USD/CAD managed to close slightly above the 200-day simple moving average (SMA) and the Ichimoku cloud, increasing the likelihood for an up-trending market. The bullish cross between the 20- and the 50-day SMA is also a positive trend signal.
In terms of momentum, the rising MACD accompanied by the improving Tenkan-Sen and the softening RSI suggests a bullish-to-neutral session for the short-term. Yet to stage another rally, the bulls should overcome the 1.3340 level that kept upside movements under control this month. Beyond that, resistance could appear within the 1.3400-1.3450 congested area, a break of which would shift the spotlight towards May’s peak of 1.3563.
Should the price pull back into the cloud, the 20-day SMA currently near 1.3200 could come first into view. Moving lower and under the 50-day SMA, support could be next found around the 1.3143 level, while in case of a deeper decline below the February low of 1.3067, the bearish wave may continue until the 1.3000 level.
Regarding the medium-term picture, the market holds in a downward move since early May and only a climb above 1.3400 would officially resume a neutral profile. However, with the 50-day SMA showing no sign of correcting its bearish cross with the 200-day SMA, the odds for an outlook reversal currently appear minimal.
In brief, USD/CAD holds a bullish-to-neutral bias in the short-term, while in the medium-term the outlook remains negative.
All trading involves risk. It is possible to lose all your capital
This information is not considered as investment advice or investment recommendation but instead a marketing communication. This material has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.