Detailed FX Market Outlook and Analysis

USD/CAD: Range Trading Continues

USD/CAD Analysis

USD/CAD Analysis

The USD/CAD currency pair persists in a range-trading scenario, with the intraday bias maintaining a neutral stance. A downside movement below the pivotal level of 1.3479 would signify a continuation of the corrective descent initiated from the high 1.3897. Notably, the downside momentum is anticipated to find support around the 1.3378 level, closely aligned with the 61.8% retracement level of 1.3091 to 1.3897, precisely at 1.3399. This support is poised to act as a buffer, potentially facilitating a rebound in the exchange rate.

Conversely, an upward breach of the 1.3625 resistance level would signal a short-term bottoming, pivoting the bias towards an upward trajectory and suggesting a more robust ascent.

The ascent from 1.3091 is the fifth leg of the overall upward movement from the 2021 low of 1.2005. A sustained upward momentum is foreseen, contingent upon the resilience of the 1.3378 support level. This projection points towards the 61.8% extension of the rally from 1.2401 to 1.3976, measured from 1.3091, positioning itself at 1.4064. However, a decisive breach of the 1.3378 level would cast doubts on this outlook, potentially triggering a more profound retracement back to 1.3091.

Analysis Summary

The USD/CAD exhibits persistent range trading, with potential downside moves expected to find support at 1.3378, aligning with a crucial retracement level. Meanwhile, an upward breakout at 1.3625 could signal a short-term reversal. In the broader context, the overall ascent from 1.3091 is viewed as the fifth leg, anticipating further gains unless 1.3378 support is decisively breached.

Key Points

  1. Range trading persists; downside supported at 1.3378.
  2. An upside breakout at 1.3625 may indicate a short-term reversal.
  3. A broader perspective suggests continued ascent, dependent on 1.3378 support.

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