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USD/CAD continues to deteriorate as the pair closed beneath the late January low at 1.2738 on Tuesday. A sustained close beneath 1.2686/82 would see the “wedge” base negated, with support seen thereafter at 1.2656, the Credit Suisse analyst team appraise.

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Key quotes

“USD/CAD continues to deteriorate, further increasing the probability that the corrective upswing has already come to an end and questioning the ‘wedge’ base (supported by daily MACD momentum also about to turn lower). The market subsequently shifted into a near-term consolidation phase this morning ahead of the key 1.2686/82 low.” 

“Below 1.2686/82 would see the base negated and suggest that further downside is likely, with support seen thereafter at the back of the December 2020 downtrend, currently at 1.2656.” 

“Immediate resistance is seen at 1.2710, then 1.2766, above which would see a move back to 1.2783/87, where we would expect to see fresh sellers. Removal of here though would see 1.2828/33 next. Above 1.2845, we look for another test of 1.2870/81 and 1.2896/2907.”