USD/CAD tests key resistance after breaking above 1.4200
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USD/CAD steadies near 1.4220 after two days of gains
The pair has broken above the falling wedge pattern, a bullish formation suggesting potential upside momentum. however, the 14-day relative strength index (rsi) remains below 50, signaling that bearish sentiment still lingers and a decisive move is needed to confirm a stronger directional trend.
Key resistance levels to watch
The nine-day exponential moving average (ema) at 1.4236 is the first resistance, followed by the 14-day ema at 1.4262 a break above these levels could push usd/cad toward 1.4300, a key psychological barrier that may determine further upside potential.
Bearish scenario if price fails to hold above wedge breakout
If the pair slips back into the falling wedge, it could trigger a retest of 1.4100, a psychological support level further weakness may bring the pair toward 1.4080, marking the lower boundary of the wedge a confirmed break below this level would reinforce a bearish outlook, potentially driving the pair toward the three-month low of 1.3927, last seen on november 25.
Trading Outlook
Traders are watching for a breakout confirmation above 1.4236-1.4262 to validate bullish momentum downside risks remain if the pair falls back within the wedge pattern, with 1.4100-1.4080 acting as key support levels upcoming us and canadian economic data could provide additional volatility and direction for the pair.
The pair has broken above the falling wedge pattern, a bullish formation suggesting potential upside momentum. however, the 14-day relative strength index (rsi) remains below 50, signaling that bearish sentiment still lingers and a decisive move is needed to confirm a stronger directional trend.
Key resistance levels to watch
The nine-day exponential moving average (ema) at 1.4236 is the first resistance, followed by the 14-day ema at 1.4262 a break above these levels could push usd/cad toward 1.4300, a key psychological barrier that may determine further upside potential.
Bearish scenario if price fails to hold above wedge breakout
If the pair slips back into the falling wedge, it could trigger a retest of 1.4100, a psychological support level further weakness may bring the pair toward 1.4080, marking the lower boundary of the wedge a confirmed break below this level would reinforce a bearish outlook, potentially driving the pair toward the three-month low of 1.3927, last seen on november 25.
Trading Outlook
Traders are watching for a breakout confirmation above 1.4236-1.4262 to validate bullish momentum downside risks remain if the pair falls back within the wedge pattern, with 1.4100-1.4080 acting as key support levels upcoming us and canadian economic data could provide additional volatility and direction for the pair.