**USD/CAD Daily Outlook – In-Depth Technical and Fundamental Analysis**
*Original analysis by ActionForex.com. Expanded and modified for depth and clarity.*
The USD/CAD currency pair has been exhibiting a neutral tone recently, with prices trading within a consolidative range following a brief downward correction. Despite pressure in the short term, a larger trend remains intact, indicating potential for bulls to reassert control once consolidation completes. In this extensive analysis, we explore the latest price action, technical indicators, fundamental drivers, and potential trade strategies to help guide traders navigating this key forex pair.
## Current Technical Overview
Currently, USD/CAD is fluctuating in a broad sideways range, trading in the 1.3610–1.3740 zone. This follows a minor decline from the 1.3794 high. The price action suggests that the market is pausing after a bullish run and awaiting further cues before deciding on the next major move.
### Key Technical Observations
– **Resistance near 1.3794**: The pair recently hit a local top at this level before pulling back, forming what appears to be a temporary high or minor corrective structure.
– **Support at 1.3610–1.3640**: Short-term support is holding near the 1.3610 level, with buyers entering around 1.3640 multiple times.
– **Neutral short-term bias**: Price is consolidating and neither bulls nor bears are in full control.
– **Trendline support (Daily Chart)**: There is a rising trendline from the 1.3176 low seen in December 2023, which has kept the medium-term uptrend intact. This trendline remains unbroken and supports bullish continuation in the medium term.
– **Fibonacci retracement zones**: The 38.2 percent Fibonacci retracement (drawn from the 1.3176 low to the recent 1.3794 high) lies around 1.3550. A drop toward this zone could provide stronger buying interest.
## Technical Indicators
Several technical indicators are giving mixed but cautiously optimistic signals for the pair.
### Daily Chart Indicators
– **Relative Strength Index (RSI)**:
– Reading is currently hovering around the neutral 50 level, suggesting a lack of strong momentum in either direction.
– However, the RSI has not dipped below 40 in recent sessions, suggesting that broader bullish momentum may still be in play.
– **MACD (Moving Average Convergence Divergence)**:
– MACD histogram is flattening above the zero line, indicating fading but positive momentum.
– A bullish crossover occurred earlier in April and remains valid unless sharply reversed.
– **200-day and 50-day Moving Averages**:
– The 50-day MA is trading above the 200-day MA, maintaining a classic bullish setup known as the “Golden Cross.”
– The slope of both moving averages remains positive, reinforcing underlying bullish momentum over the medium term.
## Structural Analysis
The pair has been forming higher highs and higher lows since late 2023, maintaining a bullish structure. Despite the recent pullback from the 1.3794 level, markets perceive it as a correction within the broader uptrend rather than a reversal.
### Weekly Perspective
A look at the weekly chart reveals that the longer-term trend remains bullish. Following a breakout above 1.3600 in March, the pair surged toward multi-month highs at 1.3794, a level not seen since November 2023. The inability of sellers to push prices significantly below 1.3600 suggests that the breakout was genuine.
If bulls manage to reclaim and close above 1.3794, the next level to watch would be 1.3897, followed by a test of the psychological 1.4000 mark.
## Elliott Wave Interpretation
From an Elliott Wave perspective, the price movement since December 2023 appears to fit
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