USD/CAD Price Analysis: Bear flag confirmation hints at further downside past 1.3500
- USD/CAD takes offers to refresh intraday low, extends the previous day’s pullback from one-week high.
- Confirmation of bearish chart pattern, clear downside break of key SMAs favor sellers.
- Monthly low, YTD bottom can entertain Loonie pair sellers amid a southward journey to 1.3100 theoretical target.
USD/CAD justifies bear flag confirmation as it drops to 1.3485 while refreshing intraday low amid early Tuesday morning in Europe. In doing so, the Loonie pair also decline below the 100-SMA, as well as the 200-SMA, to amplify the bearish bias.
Adding strength to the downside bias for the USD/CAD price are the bearish MACD signals and an absence of oversold RSI (14).
Hence, the Loonie pair is well-set for further downside.
However, the monthly low of 1.3405 and the Year-To-Date (YTD) bottom surrounding 1.3262 will precede November 2022 trough of 1.3225 can challenge the USD/CAD bears before directing them to the theoretical target of near 1.3100 round figure.
It should be noted that highs marked during July and September of the last year, respectively near 1.3220 and 1.3210, act as additional downside filters to watch during the pair’s further declines.
On the flip side, the stated flag’s lower line, close to 1.3515 at the latest, restricts the immediate upside of the USD/CAD pair.
Following that, the latest swing high of near 1.3555 and the flag’s top line surrounding 1.3570 can check the Loonie pair buyers before giving them control.
USD/CAD: Hourly chart
Trend: Further downside expected