Moving Averages:
Analysis of the one-hour chart reveals that the USD/CAD pair remains below the 50-hour and 100-hour Exponential Moving Averages (EMAs). This positioning, combined with a downward slope, supports sellers, emphasizing the bearish sentiment.
Relative Strength Index (RSI):
The Relative Strength Index (RSI) is a key indicator of market momentum. In the case of the USD/CAD pair, the RSI is positioned below 50, reinforcing the current bearish momentum.
Resistance Levels:
The immediate resistance for the pair is situated at 1.3530. This level corresponds to the 50-hour EMA and coincides with the upper boundary of the Bollinger Band. If buyers manage to push the pair above this resistance, the next target could be 1.3553, where the 100-hour EMA is positioned.
Additional Upside Potential:
Beyond these levels, there's a higher resistance level at 1.3586, which corresponds to a high observed on September 13. Beyond that, the psychological round figure of 1.3600 may come into play.
Support Levels:
On the downside, the initial support level is at 1.3490, marking the lower limit of the Bollinger Band. Should the pair breach this level, it could head towards 1.3475, a previous low recorded on August 16. Further down, the next support lies at 1.3445 (a low from August 15), potentially extending towards a low recorded on August 11 at 1.3412.
The USD/CAD pair's persistent downtrend is driven by a strong rally in crude oil prices, which supports the Canadian Dollar (Loonie) and weighs on the US Dollar. Technical indicators, such as moving averages and the RSI, further confirm the bearish sentiment. Traders should monitor key resistance and support levels for potential breakout or reversal opportunities as market conditions evolve.
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