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Home » Forex Technical Analysis » USD/CAD Set to Test Key Resistance as Bullish Momentum Continues

USD/CAD Set to Test Key Resistance as Bullish Momentum Continues

  • December 24, 2024
  • 56

The USD/CAD pair is currently probing the immediate resistance at 1.4400, which marks the upper boundary of an ascending channel. The upward movement follows a three-day decline, with the exchange rate trading around 1.4380 during European market hours on Tuesday. The continued bullish sentiment is supported by the 14-day Relative Strength Index (RSI), which remains above the 70 threshold, suggesting strong momentum in the market.

Despite the overbought condition indicated by the RSI, which may signal a potential correction, its sustained position near this high could reinforce bullish trends. The pair is also favorably positioned above both the nine- and 14-day Exponential Moving Averages (EMA), further indicating a strong bullish trend and short-term price momentum. This technical alignment demonstrates significant buying interest and the possibility of continued upward movement in the near future.

Looking ahead, should the USD/CAD pair successfully break above the 1.4400 resistance level, it could pave the way for a potential retest of the multi-year high of 1.4467 achieved on December 19. Conversely, if the price were to retreat, the first line of support would likely be the nine-day EMA at 1.4323, followed by the 14-day EMA at 1.4274. Should the downward pressure persist, further support may be found at the lower boundary of the ascending channel set at the 1.4210 level.

In summary, the current market dynamics for the USD/CAD pair suggest a robust bullish bias, with key resistance and support levels being closely monitored as traders assess potential short-term price movements.

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