USD/CAD Price Analysis: Reverse from 1.3615 resistance confluence
- USD/CAD renews intraday low while paring the biggest daily jump in a fortnight.
- Convergence of 100-SMA, previous support line from mid-November challenge upside moves.
- 200-SMA appears a tough nut to crack for the bears.
USD/CAD takes offers to refresh intraday low around 1.3580 as it pares the biggest daily gains in two weeks heading into Thursday’s European session.
In doing so, the Loonie pair extends the day-start pullback from the 1.3615 resistance confluence despite bullish MACD signals.
That said, the 200-Simple Moving Average (SMA) joins the support-turned-resistance line from November 15 to highlight the 1.3615 level as the key hurdle.
Given the quote’s recent pullback from the stated resistance, a pullback towards the mid-December swing low near 1.3520 can’t be ruled out. However, the 200-SMA level of 1.3507 and the 1.3500 round figure could challenge the USD/CAD bears afterward.
In a case where the Loonie pair drops below the 1.3500 round figure, the monthly low of 1.3385 will be in the spotlight.
Alternatively, recovery moves need to portray successful trading beyond the 1.3615 key resistance to convince the USD/CAD buyers.
Even so, a one-week-old descending trend line near 1.3655 could challenge the quote’s further upside before directing the bulls toward the monthly peak of 1.3705.
To sum up, the USD/CAD pair is likely to extend the latest weakness but the room towards the south appears limited.
USD/CAD: Four-hour chart
Trend: Limited downside expected