- USD/CAD has again found bids below the 200-day MA.
- The pair had trapped sellers on the wrong side of the market with a dip below the 200-day MA in the first and the last week of February.
The sell-off in the USD/CAD seems to have run out of steam below the widely followed 200-day moving average (MA).
On Monday, the currency pair found bids below the 200-day MA at 1.3268. This is the third time in four months that the sellers are flashing signs of exhaustion below the long-term average.
The pair had dropped below the 200-day MA on Feb. 1. Back then the average was located at 1.3118. The dip below the average, however, was short-lived with the pair rising to 1.3340 by mid-February.
On similar lines, the dip below the 200-day MA seen in the last week of February was followed by a solid bounce to levels above 1.3450 by March 7.
It remains to be seen if the latest dip below the 200-day MA will trap sellers on the wrong side of the market.
It is worth noting that the 14-day relative strength index (RSI) is currently sitting on a strong support at 33.91. A break lower would imply continuation of the sell-off.
Daily chart
Trend: Bearish
Pivot points
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