USD/CAD Price Analysis: Bounces off 1.3520 support confluence
- USD/CAD reverses from intraday low, probes the previous daily loss.
- Convergence of 200-SMA, three-day-old ascending trend line restricts immediate downside.
- Bulls remain off the table unless crossing the previous support line from November.
- Downbeat RSI line, sustained trading below key trend line, SMA favor sellers.
USD/CAD takes a U-turn from the intraday low while picking up bids to 1.3560 amid the holiday-thinned trading session on Monday. In doing so, the Loonie pair bounces off the convergence of the 200-SMA and an upward-sloping support line from the last Wednesday.
That said, the quote’s failure to stay beyond the support-turned-resistance line from November 15, following the previous week’s bounce off the 200-SMA, joins sustained trading below the 50-SMA to keep USD/CAD sellers hopeful.
As a result, the Loonie pair is likely to conquer the 1.3520 support level and aim for the 1.3500 round figure.
However, the double bottom around 1.3485, marked in the last week, will be crucial for the USD/CAD bears to keep the reins.
Following that, the previous monthly low of around 1.3385 could lure the pair sellers ahead of November’s bottom surrounding 1.3225.
Meanwhile, the pair’s recovery moves could aim for the weekly resistance line, around 1.3570, before poking the 50-SMA level surrounding 1.3580.
Though, successful trading beyond the 1.5-month-old support-turned-resistance line, close to 1.3610 at the latest, becomes necessary for the USD/CAD bulls to retake control.
Overall, USD/CAD is likely to remain on the bear’s radar unless even as the downside room is limited.
USD/CAD: Four-hour chart
Trend: Further downside expected