- USD/CAD is trading just under flat on Monday as the pair stalls.
- There is now a consolidation zone between 1.3491 and 1,3315.
USD/CAD 4-hour chart
USD/CAD has been consolidating after falling in recent times. The pair has been in a downtrend since hitting a high of 1.4668 on 19th March. The base of this pattern is holding at the consolidation low of 1,3315. Today the dollar has been slightly stronger and the ISM manufacturing data helped the green push higher as it beat the analyst expectations of 53.6 to print at 54.2.
Looking closer at the chart, the last 4-hour candle is pretty bearish but a break of the previous wave low near 1.3372 could mean the aforementioned consolidation low might be tested. If there is a break of the orange support level then the downtrend could be continuing and on the higher timeframes, the next support is 1.3078.
The indicators are showing signs of improving at the moment. The MACD signal lines are just about above the mid-zone and the histogram is still in the green. The Relative Strength Index is at the 50 line but looks like it could dip below again.
It is important to remember that the pair is in a downtrend. Oil is trading higher at the beginning of the week but the market is mixed at the moment. If this market trend is to reverse then the previous wave high of 1.3459 would need to be broken.
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