USD/CAD Daily Forex Analysis
In our Daily Forex Analysis, USD/CAD has shown a break of the minor resistance level at 1.3228, which confirms a short-term bottom at 1.3115. This is supported by a bullish convergence condition in the 4-hour MACD indicator. The intraday bias has now shifted to the upside, targeting the 1.3229 support turned resistance level. A decisive breakthrough there will extend the rebound toward the 55-day Exponential Moving Average (EMA) currently situated at 1.3389. However, a break below 1.3115 is required to confirm the resumption of the recent decline. Otherwise, we may see further consolidation in the case of a retreat.
Taking a broader perspective, the price actions from the high of 2022 at 1.3976 are still considered a correction within the overall uptrend from the 2021 low of 1.2005. However, the possibility of a trend reversal is increasing with the ongoing decline. Regardless of a potential strong rebound, the risk remains tilted to the downside as long as the support turned resistance at 1.3299 holds. The next target in focus is the 61.8% retracement level of the upswing from 1.2005 to 1.3976, located at 1.2758. Sustained trading above the 1.3229 level will elevate the likelihood of the correction being completed, shifting the focus back to the resistance at 1.3653.
To summarize, our Daily Analysis suggests that USD/CAD has confirmed a short-term bottoming pattern, and the intraday bias has turned bullish. However, caution is advised as the broader picture indicates a potential trend reversal. The key levels to watch are the support-turned resistance at 1.3299 and the resistance at 1.3229, which will provide further clues about the direction of the pair.
Key takeaways:
- Break of minor resistance confirms short-term bottoming pattern.
- Intraday bias is back on the upside, targeting key resistance levels.
- Broader outlook indicates a potential trend reversal, with important levels to watch.
