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USD/CAD is seeing short-term strength, which ideally is capped by 1.3572/85. In the downside, the pivotal 50% retracement of the 2017/2020 surge at 1.3365 is key support, analysts at Credit Suisse note.

Key quotes

“We might see further near-term strength, which ideally stays capped at 1.3572/85 for a move back lower.” 

“Post the consolidation phase and in line with the large bearish ‘descending triangle’ continuation pattern that is still in place, we see support initially at 1.3401, then the pivotal 50% retracement of the 2017/2020 surge at 1.3365/57, where we would expect to see fresh buyers at first. Removal of here in due course though would then see support next at the ‘neckline’ to the November/December 2019 base and 78.6% retracement of the 2020 surge at 1.3331/15.” 

“A close above 1.3585 would see a base complete to suggest further upside is likely, with resistance thereafter at 1.3659, ahead of 1.3802.”

 

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