USDCAD Technical Perspective
Current USDCAD price action
Looking at the USDCAD on a daily chart, we see that its value has been moving on an ascending wedge or pennant since the beginning of October, its turning point indicated by a MACD divergence. Following this turn, its MACD started a bullish phase that lasted the whole upward movement.
Currently, the MACD has signalled another divergence and is turning bearish. The price action of the latest days saw the pair bouncing off of its upper trend line. Then, touching the lower line and now it is bouncing without too much strength.
Bearish Scenario
If the price breaks below the lower trend line, it is a good hint of a trend change. If then, crosses its recent low (1.31250) to the downside it will confirm the previous sign.
With price moving as stated, we could devise a bearish scenario with a potential visit to the low made the 1stof October.
Bullish Scenario
Another possibility, although not so likely if we look at the MACD state and divergence, is that the price bounces off of its support at 1.31250. If that happens, the price action of the USDCAD may be moving to visit its 1.33800 key level.
Short-term outlook
As long as its price holds below 1.3200, our short-term outlook view for the USDCAD is for the pair to test its 1.31250 support level. If it goes above it, as we said earlier, we expect a strong bullish movement. That may be a valid hint for its intraday direction, as well.
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