- USD/CAD was seen oscillating in a range below 1.30 handle.
- The technical set-up seems tilted in favours of bearish traders.
The USD/CAD pair extended its sideways consolidative price action through the early European session on Monday and remained confined in a narrow trading band just below the key 1.3000 psychological mark.
The recent trading range constituted towards the formation of a rectangle on hourly charts. Given the pair’s recent fall, the rectangle might be categorized as a bearish continuation pattern and points to further weakness.
The set-up remains tilted in favour of bearish traders. However, slightly oversold conditions on the daily chart seemed to be the only factor holding investors from placing aggressive bets and helped limit the downside.
Hence, it will be prudent to wait for a sustained break below the trading range support, near the 1.2960 region, before positioning for any further near-term depreciating move towards challenging the 1.2900 round-figure mark.
On the flip side, any attempted recovery seems more likely to confront some fresh supply near the 1.30-1.3010 region, above which a bout of short-covering has the potential to lift the pair further towards the 1.350 supply zone.
USD/CAD 1-hourly chart
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