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USD/CAD is still in the bearish trend that has been in place since the 1.4668 high from March 19th of last year. That said, price action during the past month has illustrated a clear slowdown in terms of bearish momentum, and economists at Rabobank would argue the pair is now entering a consolidation phase.

USD/CAD   to begin a new period of consolidation in the 1.25-1.27 range

“In order for us to confirm the clear bearish phase is over and that we are moving to a new phase we need to see a confirmed close above the 100-day moving average at 1.269. Before that, the 50-day moving average at 1.2605 marks the immediate upside resistance level to break having held price action since November. The region just above the 1.26 handle also coincides with the bearish trendline in place for the past year.”

“We expect a period of sideways trading within the 1.25 to 1.27 range rather than the start of a new bullish or bearish trend.”