- USD/CAD eases from intraday high while keeping the bounce off short-term support line.
- 100, 200-SMA confluence and a falling trend line from March 30 test the bulls.
- Monthly bottom adds to the downside filters, extended consolidation more likely.
USD/CAD steps back from the day’s high of 1.2547 to 1.2541 amid early Wednesday. Even so, the loonie pair keeps its U-turn from an ascending support line from March 19.
Given the absence of extreme RSI conditions, the pair’s latest bounce off the key support is likely to cross 50% Fibonacci retracement level of late February to March 18 downside, around 1.2555.
However, any further rise will have to cross a convergence of 100 and 200-SMA near 1.2575, a break of which should push USD/CAD bulls toward attacking the two-week-old resistance line, around 1.2625.
Meanwhile, a downside break of the 1.2525 support line isn’t an open call to the USD/CAD bears as the monthly low surrounding the 1.2500 threshold should test the quote’s further weakness.
To sum up, USD/CAD is in a consolidation mode inside a symmetrical triangle, which in turn suggests the latest corrective pullback to continue.
USD/CAD four-hour chart
Trend: Further recovery expected
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