USD/CAD Price Analysis: Defends five-month-old trend line break below 1.2500
|- USD/CAD remains sidelined after confirming the key resistance breakout.
- RSI conditions, ascending trend line from May test bulls.
- 100-DMA adds to downside filters, 1.2650-55 acts as tough nut to crack for buyers.
USD/CAD stays sidelined around 1.2480, following its sustained break of a crucial resistance, during Thursday’s Asian session. In doing so, the Loonie pair struggles to find direction between the previous resistance line and an upward sloping trend line from May.
Adding to the pair traders’ indecision are the RSI conditions suggesting a pullback move from the immediate hurdle, namely a two-month-old rising trend line near 1.2535.
Even if the quote fails to step back from 1.2535, a convergence of 200-DMA and April’s top near 1.2650-55 will e a tough nut to crack for USD/CAD bulls.
Meanwhile, profit booking moves may bounce off the previous resistance line from February near 1.2430, a break of which could direct the pair towards the 1.2400 round figure.
It should, however, be noted that the USD/CAD weakness below 1.2400 will be tested by a 100-DMA level of 1.2378.
Overall, USD/CAD remains bulls but intermediate corrections can’t be ruled out.
USD/CAD: Daily chart
Trend: Pullback expected
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.