USD/CAD Price Analysis: Confirms rising wedge as bears approach 1.3000
- USD/CAD takes offers to renew one-week low during three-day downtrend.
- Clear confirmation of a bearish chart pattern, impending bears cross on MACD favor sellers.
- Confluence of 50-DMA, 38.2% Fibonacci retracement appears short-term key support.
- Buyers need to cross 1.3200 to retake control, 1.3075 appears immediate resistance.
USD/CAD remains on the back foot for the third consecutive day as sellers renew the eight-day low around 1.3030 heading into Friday’s European session. In doing so, the Loonie pair justifies the downside break of the bearish chart pattern called the rising wedge.
Not only the rising wedge confirmation but the impending bear cross on the MACD and failures to stay beyond 1.3130 horizontal hurdle, comprising multiple tops marked since mid-July, seem to have favored the USD/CAD bears.
That said, a convergence of the 50-DMA and a 38.2% Fibonacci retracement level of June-July upside, near 1.2955-50, will be strong support for the pair traders to watch during the quote’s further weakness.
Should the USD/CAD remains weak past 1.2950, the odds of witnessing a south-run towards the previous month’s low, near 1.2730, can’t be ruled out. During the fall, the 50% and 61.8% Fibonacci retracements, close to 1.2870 and 1.2890 in that order, could act as buffers.
Meanwhile, recovery moves may initially aim for the wedge’s support line, now resistance near 1.3060.
Following that, the 1.3100 threshold and a downward sloping resistance line from mid-July, around 1.3210, could test the pair buyers. Also acting as an upside hurdle is the yearly top, near 1.3225 by the press time.
USD/CAD: Daily chart
Trend: Further weakness expected