- USD / CAD faces rejection once again near 1.2850 amid firmer WTI prices.
- The pair has room to rise further amid a bullish breakout and firmer RSI.
- The immediate drop could find some support in the 1.2790 price zone.
USD / CAD is extending its corrective pullback from the three-month highs of 1.2846, now attacking the 1.2800 level amid a rally in oil prices.
The pair is not benefiting from the resurgence in demand for the US dollar across the board as WTI bounces more than 2% so far on Monday.
Meanwhile, investors beat mixed US and Canadian employment data as they await the Bank of Canada (BOC) rate decision to be announced on Wednesday.
Looking at the USD / CAD daily chart, the bears have struggled to regain control as the price now seeks to test the critical trend line resistance now at 1.2791.
Despite the pullback, upside potential remains intact after the pair witnessed a break to the upside from the support of the three-month downtrend line last Thursday.
The 14-day Relative Strength Index (RSI) is just below the overbought territory, allowing more room for rises.
The bulls will need to break through multi-month highs to hit September highs at 1.2896.
USD / CAD Daily Chart
To the downside, a firm break below the aforementioned strong support at 1.2791 could accentuate the correction towards Friday’s low of 1.2744.
The next bearish target is anticipated at 1.2700 if the selling pressure accelerates.
USD / CAD Technical Levels
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