USDCAD has extended its decline, breaking through a key support level. This analysis examines the technical situation and explores potential scenarios for the currency pair.
Downside Move Resumes:
- 1.3466 Support Breached: USDCAD decisively fell below the support level of 1.3466. This technical breakdown suggests a resumption of the downtrend that commenced from 1.3605.
Potential Downside Targets:
- 1.3419 Support in Focus: In the near future, the bears likely aim to test the next support level at 1.3419. A breakdown below this point could further accelerate the decline towards the 1.3340 area.
Signs of a Potential Rebound:
- 1.3490 Initial Resistance: While the immediate outlook appears bearish, a possibility for a bounce still exists. The initial resistance level to watch is at 1.3490. Reclaiming this level could indicate a temporary pause in the downtrend.
Key Levels to Monitor:
- 1.3419 Crucial Support: The critical level to watch is 1.3419. If this support holds, it weakens the bearish case and suggests a possible rebound or consolidation before the downtrend potentially resumes.
- Upside Resistance Levels: If the bulls manage to push the price higher, they would first face resistance at 1.3525. Overcoming this hurdle could lead to a test of the previous resistance level at 1.3560. A breakout above 1.3560 would signal a potential completion of the downside move from 1.3605, opening the door for a potential rise towards the previous high of 1.3605.
Overall Sentiment:
The technical analysis for USDCAD leans bearish in the short term. The breakdown below 1.3466 support strengthens the downtrend. However, a close eye should be kept on the price action around 1.3419. Holding this support could indicate a short-lived decline or a potential reversal. Monitoring these key levels will be crucial in determining the future direction of USDCAD.