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The USD/CAD pair has a tendency to move downward, and the current upswing may reach a ceiling around 1.3568/75. At 1.3705, the cycle high set on December 16, there is still room for USD/CAD to rise.
The USD/CAD is making a three-day rebound after plummeting towards 1.3400, but it is still trading above a support trendline that has existed for five months. The USD/CAD currency pair hit a daily low of 1.3446 and is currently trading at 1.3474.
Although falling 2.85% since March 24, the USD/CAD remains neutral to upward inclined on the daily chart.
However, buyers prevented sellers from hitting the 200-day Exponential Moving Average (EMA), which is at 1.3374, and they are optimistic about regaining the 100-day EMA, which is at 1.3515. Despite printed gains, the 20 and 50-day EMA confluence at about 1.3568/75 may act as a ceiling on USD/CAD growth. If that happens, the USD/CAD may shortly return to its downward trend and test the 200-day EMA.
On the other hand, the USD/CAD needs to move past the 1.3575 region on its path to 1.3600 for a bullish continuation. Once passed, the USD/CAD upside risks are at 1.3705, the cycle high from December 16, then at 1.3804, the daily high from March 24.
The Relative Strength Index (RSI), an oscillator, has changed course and is now heading north but in bearish territory. This indicates that sellers are still in control and that there is a chance that the upward correction will reverse course. While buyers entered the market, they are more likely to be outweighed by sellers, according to the Rate of Change.
