The USD/CAD has bounced on the lower limit of its several -year bullish trend channel in 1,3535, with a positive divergence in the MACD that indicates a fading of the bearish impulse. While this opens the door to a consolidation or a new 1,3800 test, a decisive breakdown below 1,3535 would threaten with a deeper fall, the Société currency analysts point out Générale.
Watch 1,3800 for next rise test
“The USD/CAD reached the lower limit of the ascending channel drawn from 2021, in 1,3535, triggering a brief upward movement. The positive divergence in the daily MACD indicates that the downward impulse is gradually decreasing.”
“While this is not a sign of reversal, it denotes the possibility of consolidation. A new test of the recent maximum pivotant in 1,3800 cannot be ruled out. A crossing above this level can lead to a larger rebound. However, there will be a risk of a deeper bearish trend if the torque breaks 1,3535.”
Source: Fx Street
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