USD/CAD Price Analysis: Pokes 1.3600 support to defy bullish pennant
- USD/CAD holds lower ground as sellers attack bullish chart pattern.
- Bearish MACD signals, downbeat RSI hints at rejection of pennant formation but 50-SMA can test the bears.
- Multiple hurdles to the north challenge Loonie pair buyers.
USD/CAD bears flex muscles around 1.3590 amid the early Asian session on Friday, poking the lower line of a one-week-old bullish pennant.
That said, the Loonie pair’s multiple failures to stay beyond 1.3600, as well as the recent grinding near the highest levels since early January, suggest that the bulls are running out of steam. Additionally, the bearish MACD signals and the RSI (14) conditions suggesting the continuation of the latest weakness by staying around the neutral 50 level also signal further declines of the quote.
However, the 50-bar Simple Moving Average (SMA) level surrounding 1.3570 could test the USD/CAD pair sellers ahead of the late February swing low near 1.3515 and the 1.3500 round figure.
In a case where the quote breaks the 1.3500 threshold, the odds of its slump to the 1.3440-35 support zone can’t be ruled out. It should be noted that the 200-SMA joins multiple levels marked since mid-February to highlight the stated support area.
Meanwhile, recovery moves remain unimpressive unless the quote stays inside the bullish pennant, currently between 1.3595 and 1.3635.
Following that, the highs marked during late February and early January, respectively near 1.3665 and 1.3685 will precede the December 2022 peak of 1.3705 to check the USD/CAD pair’s upside momentum.
USD/CAD: Daily chart
Trend: Further downside expected