Alongside the Canadian dollar, this pair has been trading higher since last week, breaking above the previous day's range. It has breached the upper border at 1.3744. The price surged and halted losses at the level of 1.3613. Perhaps strong support was found here, leading to a rebound to the downside. Currently, the price is consolidating in this area, trying to hold its ground. The recent downturn has pushed the price chart into the super trend red zone, indicating selling pressure. In this timeframe, the price is in a downtrend using a bearish flag pattern. If the price breaks above this channel, we may see a bullish move towards the 1.3613 level. I have also shared this analysis in my journal post. Click here to see my analysis. Currently, the price is increasing weekly, but after reaching some heights, it is declining, where a stable level began to be appropriate. This suggests a need for a correction to ensure consolidation within the current price range. However, the pair continues its downward trend, and expectations of a downturn are moderate. A sign of downside readiness would be a halt below 1.3613. This is an important resistance area for a retest and subsequent bounce. The next rebound is poised for more significant movement, targeting the areas of 1.3587 and 1.3531. A signal to cancel the current scenario would be if the price rises above the reversal level of 1.3713. Although it is falling below the signal line, the Relative Strength Index (RSI) is near the neutral level of 50, indicating a lack of clear direction. . It is close to the 50-day moving average, while the 200-day moving average provides strong support. If the pair moves above 1.3630 near this support level, it could move upwards towards resistance around 1.3900. Breaking this resistance level could lead to further gains, possibly reaching previous highs. USD/CAD is currently in a correction phase, but falling below the 200-day moving average could neutralize long-term sentiment. However, technical indicators suggest a potential reversal, with chances of bouncing off key support levels, paving the way back to previous highs. The upcoming speech by the Bank of Canada Governor could also influence the pair's direction by providing hints about Canadian monetary policy.
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