Key Highlights
· The US dollar remains in a downtrend below 1.2540 against the Canadian dollar.
· There is a key bearish trend line forming with resistance at 1.2480 on the 4-hours chart of USD/CAD.
USD/CAD Technical Analysis
The US dollar traded lower during the past three weeks against the Canadian dollar and tested the 1.2350-60 support. The USD/CAD pair is currently consolidating above 1.2360 and is preparing for the next move.
Looking at the 4-hours chart of USD/CAD, there was a major decline from well above 1.2900 to 1.2350. Later, the pair started a decent recovery, but the upside move was capped by the 1.2580 resistance and the 100 simple moving average (red, 4-hour).
The pair declined and retested the 1.2350-60 support. At the moment, it seems like USD/CAD is consolidating above the mentioned 1.2350-60 support. On the upside, there is a key bearish trend line forming with resistance at 1.2480 on the same chart.
The trend line resistance at 1.2480 is positioned along with the 100 SMA. Therefore, a proper break above the 1.2480 level and 100 SMA is needed for buyers to control.
