Daily outlook - USD/CAD returns to weekly R1
- As it was expected, the USD/CAD currency rate bounced off from the 100-hour SMA near 1.2677 and once again surged to the weekly R1 at 1.2738, and even managed to bypass it for couple of hours.
- Fortunately for the Loonie, an announcement of information on the US CPI led to 33-pips depreciation of the Greenback.
- For the reason, the pair has two main options. Either it will find a support already at the above-mentioned 1.2677 level, or it will slip to a combination of the 200-hour SMA and the monthly PP at 1.2636 and only then make a rebound.
- The first scenario seems more likely, as it is supported by multiple technical indicators, which send a signal that the rate is oversold.
- On the other hand, the second option represents a more sizable barrier for the given currency pair.