**USD/CAD Technical Analysis: Struggles Persist Despite Brief Break Above the 100-Day Moving Average**
*Adapted from an article by Greg Michalowski on InvestingLive.com with additional insights and technical context.*
The USD/CAD currency pair has continued to exhibit mixed behavior, failing to capitalize on a short-lived move above its 100-day moving average (MA). This development suggested a temporary bullish push, but the inability of the pair to sustain gains above this key technical barrier reinforced a bearish undertone in the broader trend. Traders and analysts are left to consider whether this was merely a failed breakout or a warning sign for further losses ahead.
This article examines the current technical setup and broader market influences impacting USD/CAD, expanding on the original report by Greg Michalowski and drawing from multiple sources to provide insight into where the pair may be heading in the near term.
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## Key Technical Levels on the USD/CAD Chart
Over the last few trading sessions, USD/CAD has tested major technical levels that suggest trader indecision. Price action around these zones could play a decisive role in defining the pair’s short- and medium-term direction.
– **100-Day Moving Average (MA):** One of the most closely monitored technical levels in the forex market, the 100-day MA currently sits around 1.3666. USD/CAD briefly moved above this level but quickly retreated, a bearish sign highlighting that buyers are struggling to take control.
– **38.2% Fibonacci Retracement Level:** Based on the recent move from the March high near 1.3860 to the low in April around 1.3600, the 38.2% retracement zone comes in at approximately 1.3678. The price broke above this zone but failed to hold, adding to technical rejection.
– **Swing Area Between 1.3685 and 1.3701:** Historically, USD/CAD has seen significant buying and selling activity in this range. The pair found some resistance here once again, reflecting that traders consider it an important price zone for evaluating trend strength.
– **200-Day Moving Average:** Currently hovering near 1.3516, this longer-term support level represents a potential downside target if bearish momentum builds.
These levels create a well-defined battlefield between bullish and bearish players. For buyers to re-establish control, they must push the price above 1.3700 and sustain gains. Until then, the bearish bias remains prevalent.
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## Failed Breakout Above the 100-Day MA: What It Means
Breaking above a key moving average such as the 100-day MA typically suggests bullish intent, especially when the breakout is supported by increased volume and follows significant consolidation. However, in this case, USD/CAD’s breakout was:
– **Short-lived** — The move above 1.3666 (100-day MA) lasted less than a full trading day.
– **Lacked follow-through** — Prices couldn’t stay above 1.3685, marking a failed attempt to initiate a bullish trend.
– **Technically rejected** — Sellers quickly drove the price back to the downside, signaling that traders viewed the move as overextended or premature in the absence of stronger fundamentals.
According to Greg Michalowski, the rejection from the highs and the failure to hold above the 100-day MA underscores the importance of that level and reveals buyer indecisiveness.
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## Price Action and Candlestick Behavior
Candlestick analysis further supports the bearish undertone. The most recent daily candles demonstrate:
– **Rejection Wicks:** Long upper shadows on daily candles near 1.3685 suggest that buyers attempted to push higher but met stiff resistance.
– **Lower Daily Closes:** The inability of the pair to maintain intraday highs shows sellers regaining control during the U.S. and Asian trading sessions.
– **Pivot-elevated consolidation:** Candles are forming around key pivot levels instead of trending, suggesting that participants are waiting
Read more on USD/CAD trading.