USD/CAD Price Analysis: Buyers need validation from 1.3500 to retake control

USD/CAD grinds higher while paring the biggest daily fall in a fortnight.
50-SMA, ascending trend line from early September restrict immediate downside.
Seven-week-old horizontal support area challenge buyers before 200-SMA.
Bearish MACD signals, steady RSI favor short-term sellers.

Anil Panchal FXStreet

USD/CAD seesaws around the intraday high of 1.3391 as bulls struggle to retake control heading into Wednesday’s European session. That said, the Canadian Dollar (CAD) pair reversed from the 1.5-month-old horizontal resistance the previous day while posting the biggest daily loss in two weeks.

However, the quote’s sustained trading beyond the 50-SMA and an upward-sloping support line from September 13, respectively near 1.3340 and 1.3255, seem to keep the USD/CAD buyers hopeful.

Even so, the bearish steady prints of the Relative Strength Index (RSI), placed at 14, join the bearish signals from the Moving Average Convergence and Divergence (MACD) indicator, to suggest that the quote has limited upside momentum.

As a result, the latest recovery may aim for the aforementioned resistance line surrounding the 1.3500 hurdle. However, any further upside will need validation from the 200-SMA level of 1.3580 to convince the USD/CAD buyers.

In a case where the Loonie pair stays firmer past 1.3580, the odds of witnessing a run-up toward the monthly high near 1.3810 can’t be ruled out.

On the contrary, a downside break of the 50-SMA and aforementioned short-term support line, close to 1.3340 and 1.3255 in that order, could challenge the USD/CAD pair’s fresh declines.

Following that, the monthly low of 1.3226 could act as the last defense of the pair buyers.

USD/CAD: Four-hour chart

Trend: Limited recovery expected

Additional important levels

Overview
Today last price	1.3389
Today Daily Change	0.0016
Today Daily Change %	0.12%
Today daily open	1.3373

Trends
Daily SMA20	1.3471
Daily SMA50	1.356
Daily SMA100	1.326
Daily SMA200	1.3001

Levels
Previous Daily High	1.346
Previous Daily Low	1.3373
Previous Weekly High	1.3409
Previous Weekly Low	1.3226
Previous Monthly High	1.3978
Previous Monthly Low	1.3496
Daily Fibonacci 38.2%	1.3406
Daily Fibonacci 61.8%	1.3427
Daily Pivot Point S1	1.3344
Daily Pivot Point S2	1.3315
Daily Pivot Point S3	1.3257
Daily Pivot Point R1	1.3431
Daily Pivot Point R2	1.3489
Daily Pivot Point R3	1.3518

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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