USD/CAD Rate Reaches Significant Support Level
On June 12, we wrote about bearish signs observed on the USD/CAD chart, pointing to the prospect of USD weakening.
Since then, the USD/CAD rate has decreased by approximately 0.75% and has reached an important support level, specifically the lower boundary of the descending triangle (with the median around 1.36700), which indicates a long-term balance of supply and demand among market participants.
The fact that today the USD/CAD rate is rising from yesterday's minimum on June 4 at the level of 1.36408 confirms the importance of the support formed by the lower boundary of the triangle.
According to today's technical analysis of the USD/CAD chart:
the price in the second half of June is moving within a downtrend (shown by the red channel);
the price has dropped into the lower half of the red channel, indicating bearish preference;
bulls attempted to push the price upward in mid-June, breaking through the upper boundary of the triangle, but failed a bearish sign.
Could the lower boundary be breached? Certainly, if there are fundamental drivers for it.
Such drivers could be the Canadian inflation news they are set to be released today at 15:30 GMT+3.
According to ForexFactory, it is expected that the CPI index will decrease on a monthly basis and will be 0.3% (compared to 0.5% a month ago).
Be prepared for volatility spikes tonight.
Read analytical USD/CAD price forecasts for 2024 and beyond.
Read more: https://fxopen.com/blog/en/oa-usd-cad-rate-reaches-significant-support-level/
Text source: Forex Trading Blog
