The USD/CAD pair has extended its winning streak for the second consecutive session on Tuesday, propelled by a steady US Dollar (USD) and an atmosphere of risk aversion. As market participants await key economic data from the United States (US), the USD/CAD pair has edged higher to approach the 1.3590 mark during Asian trading hours.
Technical analysis reveals a positive outlook for the USD/CAD pair, with the 14-day Relative Strength Index (RSI) comfortably positioned above 50. This suggests a bullish momentum, potentially paving the way for the pair to surpass the psychological resistance level of 1.3600 after overcoming the major barrier at 1.3650.
The Moving Average Convergence Divergence (MACD), a lagging indicator, further supports the bullish sentiment for the USD/CAD pair. This bullish trend confirmation is derived from the MACD line’s positioning above the centerline and the signal line.
In terms of potential downside, the USD/CAD pair is likely to find crucial support around the nine-day Exponential Moving Average (EMA) at 1.3552, in alignment with the significant support level of 1.3550. A breach of this support zone could prompt the pair to target additional support around the 23.6% Fibonacci retracement level situated at 1.3505, coinciding with the psychological level of 1.3500.
As the USD/CAD pair navigates these technical levels, market participants will closely monitor the upcoming economic data from the US, as it has the potential to influence the pair’s trajectory. Traders and investors remain attentive to developments, particularly around the key resistance and support levels highlighted in the technical analysis, as they navigate the current market dynamics.
