CAD – Beware of a Top and Retreat in USD/CAD

As seen in the technical chart, the USD/CAD pair failed to break above the 100-day moving average in January and was subsequently capped by the 25-day moving average at the beginning of this month. Overall, since November of last year, the pair has exhibited a pattern of lower lows. It is estimated that USD/CAD has a high probability of further decline and could retest the late January low of 1.3481. A break below this level would likely trigger a further decline in the U.S. dollar. Further support is expected at 1.3410 and 1.3360, followed by the 100-month moving average at 1.33 and the 7-year low of 1.3176 in 2023. Current resistance is expected at the 50-day moving average at 1.3730 and 1.38, with a key level at 1.39. The pair encountered resistance near 1.39 for several days in early last month; the next level to watch is 1.40.

Forecast range:
Resistance: 1.3730 – 1.3800 – 1.3900 – 1.4000
Support: 1.3481* - 1.3410 - 1.3360 – 1.3300 – 1.3176

Key Focus:
Friday
Canada GDP (21:30)

Any questions? contact our professional analysis team