USD/CAD Price Analysis: Further downside below 1.2900 appears on the cards
- USD/CAD struggles inside the key DMA envelope after dropping the previous day.
- Fortnight-old descending trend line adds to the upside filters, bearish MACD favors further downside.
- 21-DMA holds the key to seller’s welcome, 10-DMA guards recovery.
USD/CAD fades bounce off intraday low around 1.2880 during Friday’s Asian session. In doing so, the Loonie pair remains pressured inside the familiar trading range between the 10-DMA and the 21-DMA by the press time.
It’s worth noting that the quote dropped the most in a week while reversing from the confluence of the 10-DMA and a two-week-old resistance line, around 1.2915-20 at the latest.
The pullback also gains support from the bearish MACD signals, which in turn challenge the quote’s corrective bounce afterward.
However, the 21-DMA support of 1.2837 precedes the weekly low near 1.2820 to challenge the short-term downside of the USD/CAD prices.
In a case where the pair stays weak past 1.2820, the odds of witnessing a south-run towards the 50% Fibonacci retracement of April-June upside, near 1.2740, can’t be ruled out.
On the contrary, a clear upside break of the 1.2920 hurdle could propel the USD/CAD pair towards the 1.3000 psychological magnet.
Following that, the double tops surrounding 1.3080 appear tough nut to crack for the bulls.
USD/CAD: Daily chart
Trend: Further weakness expected