- USD/CAD posts modest gains amid the USD demand and a decline in oil prices.
- The pair holds below the 50- and 100-hour EMAs.
- Relative Strength Index (RSI) is located in the 40-60 zone, indicating a non-directional movement.
- The key resistance level for the pair is seen at the 1.3505-1.3515 region; 1.3443 acts as an initial support level.
The USD/CAD pair recovers its recent losses during the early European trading hours on Tuesday. The pair currently trades near 1.3487, gaining 0.25% for the day.
The hawkish stance from the Federal Reserve (Fed) officials and a decline in oil prices are the main drivers for the pair. Market players await the Canadian GDP numbers and the US Core Personal Consumption Expenditure (PCE) Price Index data on Friday for fresh impetus.
From the technical perspective, USD/CAD holds below the 50- and 100-hour Exponential Moving Averages (EMAs) with a downward slope on the four-hour chart, which supports the sellers for the time being. Meanwhile, the Relative Strength Index (RSI) is located in the 40-60 zone, indicating a non-directional movement in the USD/CAD pair.
The critical resistance level for the pair is seen near the confluence of the upper boundary of the Bollinger Band and 100-hour EMA at the 1.3505-1.3515 zone. The additional upside filter to watch is near a high of September 15 at 1.3550. Any follow-through buying above the latter will pave the way to a high of September 13 at 1.3586, followed by a psychological round figure at 1.3600.
On the downside, a break below the lower limit of the Bollinger Band of 1.3443 will see a drop to a key contention at 1.3400. The mentioned level represents a psychological figure and a low of August 11. Further south, the next downside stop will emerge at 1.3380 (a low of September 19).
USD/CAD four-hour chart
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