The USD/CAD currency pair is showing a strong performance as it continues to hover above the critical support level of 1.4400, amid bullish market sentiment. Currently trading around 1.4410, the pair recently encountered a slight pause after a commendable three-day rally. Technical analysis indicates that the pair remains firmly situated within an ascending channel that has supported its upward trend.
Short-term momentum appears to favor further appreciation of the USD/CAD pair, with current positions above both the nine-day and 14-day Exponential Moving Averages (EMAs) reinforcing a positive outlook. This upward positioning is indicative of sustained buying activity in the market, which bodes well for a potential increase in value. The 14-day Relative Strength Index (RSI), remaining above the neutral 50 level, also highlights the ongoing positive momentum, enhancing the bullish perspective.
As the pair seeks to rise further, it is likely to test the resistance level at 1.4518, which marks the highest level reached since March 2020. If the upward trajectory continues, additional resistance is anticipated near 1.4870, positioned at the upper limit of the ascending channel.
In terms of downside risks, immediate support is established at the psychological level of 1.4400, with additional support located at the nine-day EMA of 1.4390 and the 14-day EMA at 1.4384. This alignment of support levels, particularly near the lower boundary of the ascending channel at approximately 1.4360, suggests a solid buffer against potential declines. As the market evolves, these technical indicators will play a critical role in determining the future direction of the USD/CAD pair.
