USD/CAD Is in a Sideways Move, Faces Further Selling Pressure


Key Resistance Levels: 1.42000, 1.44000, 1.46000
Key Support Levels: 1.34000, 1.32000, 1.30000

USD/CAD Price Long-term Trend: Bearish
The USD/CAD was earlier in a sideways trend before its sudden rise in March. The bull market reached level 1.46503 and price was said to be in the overbought region. Sellers emerged as price fell to 1.38626 low. There was a downward correction to the high of level 1.42650. The selling pressure resumed as the market fell to level 1.39367 low. The downtrend is likely to continue.

USD/CAD – Daily Chart

Daily Chart Indicators Reading:
As a result of the downtrend, the market is at level 48 of the relative strength index. This indicates that the pair is in the downtrend and also below the center line 50. There is a possibly drop in the currency pair.

USD/CAD Medium-term Trend: Bearish
On the 4-hour chart, the pair is in a bear market. A Fibonacci tool is used to determine the extent of the downward move. A  candle body is testing the 0.382 Fibonacci retracement level. According to the bull candle at 0.382 retracement level, the market is likely to reverse at 1.618 Fibonacci extension level. In other words, price will reverse at level 1.38000. From the price action, the market has reversed but the downtrend is continuing to reach the Fibonacci extension level.

USD/CAD – 4 Hour Chart

4-hour Chart Indicators Reading
Presently, the 21-day SMA and 50-day SMA are sloping horizontally indicating the earlier sideways move. Also, the market is below 20% range of the daily stochastic. This implies that the market is approaching the oversold region. In the oversold region, buyers are likely to emerge. Meanwhile, the market is in a bearish momentum.

General Outlook for USD/CAD
In the meantime, the pair is falling and approaching the oversold region. It is likely price will reach level 1.38000 which is the reversal price level of the Fibonacci tool. Perhaps, buyers may come in at the Fibonacci extension level.

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Azeez Mustapha

Azeez Mustapha is a trading professional, currency analyst, signals strategist, and funds manager with over ten years of experience within the financial field. As a blogger and finance author, he helps investors understand complex financial concepts, improve their investing skills, and learn how to manage their money.