USDCAD Fails to Establish Successful Bullish Reversal

Market Analysis – July 24

USDCAD recently tested an unmitigated bullish order block formed in September last year, which temporarily paused the price decline and created a bounce. However, the initial optimism for a bullish reversal is quickly diminishing as USDCAD has since formed a failed high, signalling weakening upward momentum.

USDCAD Key Levels

Demand Levels: 1.35400, 1.34200, 1.31770
Supply Levels: 1.39470, 1.44680, 1.47940

USDCAD Long-term Trend: Bearish

USDCAD consolidated between 1.44680 from December through March before bears eventually gained control, leading to a steady decline. The price recently tested a medium-sized unmitigated bullish order block that initially provided support.

After bouncing from 1.35390, the price attempted to move higher but encountered resistance at the 30 and 50-period Moving Averages, forming a swing high before pulling back to support. A second rebound attempt resulted in a failed high, confirming that bearish pressure remains strong.

USDCAD Short-term Trend: Bearish

On lower timeframes, bearish momentum has strengthened with price action now targeting 1.35400. The 30 and 50-period Moving Averages remain positioned above price, confirming the short-term downtrend. The bearish structure remains dominant unless buyers can reclaim key resistance levels. A break below 1.35400 could accelerate the decline toward 1.34200. Traders should monitor for either a strong rejection at support or a confirmed breakdown before considering new positions.