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USD/CAD has seen a rebound higher from the pivotal support zone at the current range lows, 50% retracement of the 2020 surge and ‘neckline’ to the large base at 1.3856/3793, completing a small base above 1.3971/70, per Credit Suisse. Canada Retail Sales in focus.

Key quotes

“The range bottom has held once more and suggests an extension of the upswing within the range, with resistance initially at 1.4062. Above here would see resistance at 1.4136/41, ahead of 1.4173, removal of which would negate the previous bearish ‘outside day’ and reinforce the upswing, with resistance then seen at the upper end of the range at the April highs at 1.4262/65, where we would expect to see fresh sellers at first.” 

“Short-term support at 1.3971/70 now ideally holds to maintain the base. In contrast, a clear and conclusive break below 1.3856/1.3793 would turn the trend back lower and see weakness extend further, with support seen at 1.3734 next.”