Market NewsTechnical Analysis

USD/CAD: Bear Has an Open Gate to Extend Its Move

USDCAD BoC Economic Indicators
  • USD/CAD has been heading towards the downside with good momentum on the H4 chart.
  • The SMA 30 has been working as a resistance.
  • The H1 chart looks bearish heading towards 1.32200.
  • Intraday minor charts have been bearish.
USD/CAD H4 chart
USD/CAD H4 chart

USD/CAD -Technical Analysis- H4 chart

The chart shows that the price has been heading towards the downside with good bearish momentum. At the last rejection at the SMA 30’s resistance, it produced a bearish inside bar and moved towards the South in a hurry. On its way, it made a significant breakout at 1.33150. The sellers may wait for the price to consolidate and produce a bearish reversal pattern to go short in the pair. The price may find its next support around 1.31500.

On the contrary, the buyers must wait for the price to produce a strong bullish reversal pattern or make a breakout at the SMA 30’s resistance to look for long opportunities. As things stand with the pair, it may take time.

USD/CAD H1 chart
USD/CAD H1 chart

Price Action Analysis- H1 Chart

The H1 chart shows that the price has been bearish by obeying a trend line. At the last rejection, it consolidated at the trend line’s resistance and produced a bearish engulfing candle before making a significant move. It found its support around 1.32750 and traded around the level for a while. Eventually, it made a breakout and traded below the level. Consequently, it has found its resistance at the flipped level of resistance. Thus, the sellers may drive the price towards the South. The price may find its next support around 1.32000.

Considering both charts, it seems that the bear is going to dominate in the pair. The trend line on the H1 chart and the SMA 30 on the H4 chart may make the pair remain bearish and make a new lower low.

Written by: Md Tareq Sikder, Senior Analyst Forex Prop News

Contact and follow Tareq on Twitter: @tareqfpn

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