CAD – USD/CAD continued rebound trends

Since mid-June, the USD/CAD exchange rate has formed three similar bottoms: 1.3539 on June 16, 1.3556 on July 3, and 1.3575 on July 23. The recent breakout above the June 23 high of 1.3798 and the July 17 high of 1.3774 suggests the start of a new, extended rally. Based on the cumulative decline since February, a 38.2% rebound would reach 1.4020, while a 50% and 61.8% extension would reach 1.4167 and 1.4315, respectively. Furthermore, the 250-day moving average of 1.3990 and the nearby 1.40 level remain crucial support levels. The support is expected at the 50-day moving average (SMA) at 1.3760 and 1.36, with further support around 1.35 and up to 1.3418.

Forecast range:
Resistance: 1.3990 - 1.4020 - 1.4167 - 1.4315
Support: 1.3760 - 1.3600 - 1.3500 - 1.3418

Focus:
Tuesday
Canada's August CPI (8:30 PM)

Wednesday
Bank of Canada Interest Rate Decision (9:45 PM)

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