The USD/CAD pair retreated to 1.3625 in early Wednesday trading in Europe after reaching its highest level in a month. The nearly overbought RSI (14) line triggered the pair’s pullback, but it remains on buyers’ radar due to bullish MACD signals and a successful upside break of the 50-day moving average (DMA).
The pair’s latest retreat is unlikely to continue unless it stays below the 50-DMA level of around 1.3580.
If the USD/CAD pair breaks the 50-DMA support, an ascending trend line from April 14 near 1.3540 will provide additional support. However, the Loonie pair remains cautious unless there is a clear downside break of a 5.5-month-long ascending support line near 1.3300.
On the other hand, a six-week-long falling resistance line around 1.3665 is limiting the pair’s immediate upside, while the late 2022 peak at 1.3705 and the current yearly high of 1.3861 are enticing USD/CAD bulls.
In summary, the USD/CAD pair’s first daily closing above the 50-DMA in a month, combined with positive oscillators, is keeping buyers optimistic about the Loonie pair’s future.
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