- USD/CAD takes offers after breaking six-week-old ascending trend line support, now resistance.
- The first bearish MACD signal in a month, RSI retreat suggests further downside.
- 50-DMA challenges bears targeting ascending support line from August.
- Bulls need validation from 1.3700 to retake control.
USD/CAD extends the previous day’s bearish move while breaking the short-term key support during early Tuesday. That said, the Loonie pair refreshes intraday low near 1.3545 by the press time.
Not only a downside break of the six-week-old ascending trend line but the biggest bearish MACD signal in a month also favor the USD/CAD sellers. On the same line could be the recently softer RSI (14), not oversold.
As a result, the pair bears are all set to conquer the 50-DMA support of 1.3537, which in turn could direct the south-run towards an upward-sloping support line from August 11, close to 1.3440 by the press time.
In a case where the USD/CAD bears keep the reins past 1.3440, a four-month-long ascending support line, close to 1.3390 at the latest, will act as the last defense of the bulls, a break of which could quickly drag the quote toward the previous monthly low surrounding 1.3225.
Meanwhile, the support-turned-resistance line from mid-November, around 1.3585, challenges the USD/CAD pair’s immediate recovery moves.
Following that, a three-week-long horizontal resistance area near the 1.3700 round figure will be crucial for the bulls, as successful trading beyond the stated hurdle won’t hesitate to cross November’s peak of 1.3808.
USD/CAD: Daily chart
Trend: Further downside expected