The USDCAD currency pair has been experiencing a prolonged downtrend from 1.3654, and the recent price action from 1.3138 indicates a period of consolidation for the ongoing downtrend. As long as the price remains below the falling trend line on the 4-hour chart, the bias is tilted towards a resumption of the downward move.
Traders should closely monitor the price action around the key support and resistance levels to gauge the potential direction of the pair. A breakdown below the 1.3138 support level could act as a catalyst for further downside momentum, potentially driving the price towards the next significant support level at 1.3000.
On the upside, the key resistance level to watch is at 1.3269. A convincing break above this level would suggest a possible completion of the downtrend and could potentially lead to a reversal in the pair’s fortunes. However, until such a breakout occurs, the bearish outlook remains intact.
In summary, USDCAD remains in a downtrend from 1.3654, and the recent consolidation phase suggests a potential continuation of the downside move. A breakdown below the 1.3138 support level could pave the way for further declines towards 1.3000. Key resistance is seen at 1.3269, and a break above this level would indicate a possible end to the downtrend. Traders should exercise caution, implement risk management strategies, and stay informed to navigate the dynamics of the USDCAD pair effectively.