USDCAD Retreats: Uptrend Over or Temporary Dip?

USDCAD’s climb stalled as it encountered resistance at 1.3541, leading to a pullback that breached the 1.3464 support level. Let’s analyze the technicals to understand whether this signals a deeper decline or a mere pause in the uptrend.

Downward Trajectory or Consolidation Phase?

  • Resistance Hurdle: USDCAD’s inability to surpass 1.3541 resistance indicates a potential roadblock for further gains.
  • Support Breach: The subsequent break below 1.3464 support suggests a potential shift in momentum, raising concerns about the uptrend’s immediate strength.

Potential Downturn and Support Levels

  • Target in Sight: Given the current momentum, a further decline towards the 1.3358 support level seems likely in the coming days.
  • Trend Completion?: If the price breaks below 1.3358, it could signal the completion of the uptrend from 1.3176. In this scenario, the next potential support area lies around 1.3300.

Rebound Hope and Resistance to Watch

  • Immediate Hurdle: If the sellers lose steam and a bounce occurs, the initial resistance to overcome is at 1.3495.
  • Retest Possibility: Reclaiming this level could trigger another rise, potentially leading to a retest of the 1.3543 resistance.

Overall Sentiment

The technical picture presents a mixed outlook for USDCAD. While a deeper decline towards 1.3358 or even 1.3300 seems possible, a bounce above 1.3495 could indicate a temporary pullback within the uptrend. The price action around the mentioned support and resistance levels will be crucial in determining the pair’s next move.