USD/CAD is trading with a bearish tone near 1.3160 as Monday’s European session begins, erasing gains from the previous day’s rebound off a nine-month low. The currency pair continues to decline within a bearish trend channel, disregarding a recent bounce from a support line that has been in place for three days.
Notably, the Relative Strength Index (RSI) (14) remains below the 50.0 level, aligning with bearish signals from the Moving Average Convergence Divergence (MACD) and reinforcing the downward pressure on USD/CAD.
Nevertheless, traders may find opportunities for bottom-picking near the immediate rising support line around 1.3150, as well as the lower boundary of the bearish channel at 1.3110. Additionally, the psychological level of 1.3100 may act as a downside filter.
However, it is important to highlight that despite a successful upside break of the 1.3215 hurdle, the USD/CAD bulls have not regained control. This could be attributed to the presence of the 200-Hour Moving Average (HMA) and a resistance line sloping downwards since June 12, positioned around 1.3225 and 1.3265, respectively.
In summary, USD/CAD is expected to continue its downward trajectory, punctuated by intermittent corrective moves.
Beyond the technical factors, the volatility in oil prices and the retreat of the US Dollar also contribute to the bearish sentiment surrounding the USD/CAD pair.
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