For the second day in a row, the USD/CAD pair moved in a bearish correction to the 1.3320 support at the time of writing the analysis from the 1.3402 resistance level, as investors continued to take risk currencies and crude oil prices held stronger gains. At the same time, the we must emphasize that the SMA 100 is higher than SMA 200 over the long term to indicate that the general trend is still bullish. It also appears that these moving averages are also fixed as dynamic support in the middle of the triangle as well, which may lead to a bounce back up.
The RSI is stable to reflect consolidation, while Stochastic appears to be retreating from oversold territory. This may indicate a strong upward rebound. If this happens, the USD/CAD pair may be in a rally on the same high chart pattern. This triangle extends from 1.3250 support to 1.3450 resistance, so the resulting rise can be 200 pips. Similarly, a break below the triangle bottom at 1.3300 could trigger a drop in the same size.
The Canadian dollar derives its strength from the rise in crude oil prices, as the sudden drop in US inventories appears to be enough to ease fears of oversupply. OPEC meetings are scheduled for the end of this week, so there may be some volatility in future trading sessions. Keep in mind that Russia questions the production agreement because it negatively affects its market share against the US.
For today's economic data, Canadian CPI figures and the trade balance will be released, and stronger-than-expected results for these data can reassure traders that the Bank of Canada will not cut interest rates in the near future, while weaker results will put pressure on the Canadian dollar.
The most important support levels for the USD/CAD today are: 1.3300, 1.3245 and 1.3180, respectively.
The most important resistance levels for the USD/CAD today are: 1.3385, 1.3440 and 1.3565, respectively.
