USD/CAD is showing gains despite a bearish bias suggested by daily chart analysis. The momentum indicator MACD also indicates a bearish trend for the pair. However, a break above the upper boundary of the descending channel and the psychological level of 1.3700 could weaken the bearish bias.
The recent appreciation of the USD/CAD pair is attributed to the decline in crude oil prices, as Canada is the largest oil exporter to the United States. The daily chart analysis indicates a bearish bias for the pair, as it remains within a descending channel. The 14-day Relative Strength Index (RSI) is slightly above the 50 level, suggesting potential for a clear directional trend.
The momentum indicator MACD also supports a bearish trend for USD/CAD, with the MACD line positioned below the centerline and the signal line. However, a convergence below the signal line could signal a shift in momentum. A breakout above the centerline could weaken the bearish trend for the pair.
Key support levels for USD/CAD are seen around 1.3600 and 1.3590, with a break below potentially leading to downward pressure towards 1.3500. Further support can be found at the lower boundary of the descending channel. On the upside, the pair is testing the upper boundary of the channel and the psychological level of 1.3700. A breakout above this level could weaken the bearish bias and lead to a potential move towards 1.3800 and April’s high of 1.3846.
In conclusion, despite the bearish bias suggested by the daily chart analysis and MACD indicator, the USD/CAD pair has shown gains as it trades around 1.3680. A break above key resistance levels could weaken the bearish bias and potentially lead to further upside towards 1.3800. Traders will be closely monitoring market developments to gauge the direction of the pair in the coming sessions.
