USD/CAD Rallies but Reaches the Overbought Region, May Face Rejection at Level 1.2610

USD/CAD Rallies but Reaches the Overbought Region, May Face Rejection at Level 1.2610

Key Resistance Levels: 1.4200, 1.4400, 1.4600
Key Support Levels: 1.3400, 1.3200, 1.3000

USD/CAD Price Long-term Trend: Bearish
USD/CAD pair is presently making an upward move. The price has broken above the 21-day SMA. If it breaks the 50-day SMA and the bullish momentum is sustained, the uptrend will continue. The selling pressure will resume if price fails to break above the SMAs. In previous price actions, the downtrend has been the main trend.

USD/CAD – Daily Chart

Daily Chart Indicators Reading:
The 50-day and the 21-day SMAs are sloping downward indicating the downtrend. USD/CAD is at level 50 of the Relative Strength Index period 14. It indicates that there is a balance between supply and demand.

USD/CAD Medium-term Trend: Bullish
On the 4-hour chart, the pair has been in an upward move. For the past week, the Loonie has been rising on the upside. The pair may face rejection at level 1.2650. On March 19 uptrend; a retraced candle body tested the 78.6% Fibonacci retracement level. The retracement indicates that USD/CAD will rise to level 1.272 Fibonacci level and reverse.

USD/CAD – 4 Hour Chart

4-hour Chart Indicators Reading
USD/CAD is trading now in the overbought region above the 80% range of the daily stochastic. Perhaps, sellers may emerge in the overbought region to push prices down. Presently, the SMAs are sloping upward indicating the uptrend.


General Outlook for USD/CAD
Presently, USD/CAD is in an uptrend but the pair is trading in the overbought region of the market. However, the upward move is doubtful as the pair has no room to rally on the upside. The pair may resume its original selling pressure.

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Author : Azeez Mustapha

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Azeez Mustapha is an experienced author, trader, markets analyst, signals strategist, and funds-manager.