USD/CAD Price Analysis: Further downside towards 1.3580 support confluence appears imminent
- USD/CAD takes offers to renew intraday low, reverses from “double top”.
- 100-HMA, two-week-old ascending trend line restrict immediate downside.
- RSI’s pullback from overbought territory, bearish MACD signals favor sellers.
- 200-HMA, 1.3530 act as crucial supports for Loonie pair bears to watch.
USD/CAD welcomes March with a bearish bias as it renews its intraday low near 1.3620 during early Wednesday morning in Europe. That said, the Loonie pair marked the biggest daily gain in a week the previous day, as well as posted the heaviest monthly jump since September 2022 by the end of February.
The quote’s latest pullback could be linked to its inability to cross the late February swing high of 1.3665. In doing so, the pair portrays the double top around 1.3660-65 region.
The chart formation also takes clues from the bearish MACD signals to lure sellers. On the same line could be the RSI (14) pullback from the overbought territory.
Hence, the USD/CAD pair is likely to register further downside. However, a convergence of the 100-Hour Moving Average (HMA) and an upward-sloping support line from mid-February, near 1.3580, appears a tough nut to crack for the bears.
Also adding to the downside filter are the 200-HMA and the weekly low, respectively near 1.3540 and 1.3530.
In a case where the USD/CAD drops below 1.3530 support, the pair confirms the bearish “double top” chart formation, which in turn suggests the theoretical fall towards 1.3400.
Alternatively, a sustained break of the 1.3660-65 hurdle could aim for January’s peak of 1.3685 and the last December’s high near 1.3700 before allowing the USD/CAD bulls a free zone to rule.
USD/CAD: Hourly chart
Trend: Limited downside expected