Since October 8, the USD/CAD pair has been consolidating above 2/8 of Murray around 1.2451. It has made 6 attempts on 4-hour charts to break this level but failed and demonstrated a technical rebound instead. This test would confirm that we are facing a strong bottom and a good point to buy if the loonie respects this level.
In view of the fact that the support of 1.2451 (2/8) has turned out to be very strong, it could be a signal for us to buy above this level. The rebound could be limited to the top of the bearish channel around the psychological level of 1.25.
A break above the bearish channel that was formed on September 17 could put an end to the downtrend and will be the beginning of a new bullish scenario. The first target can be found at the 200 EMA around 1.2630. If this level is broken, the price may reach up to 4/8 of Murray located at 1.2695.
In the European session, the Eagle indicator reached a minimum of 5 points, which means that there may be an imminent rebound in the next few hours. The next target will be at 1.25. The indicator shows that USD/CAD is heavily oversold, and as long as it remains above 1.2451, there is an opportunity for a technical bounce.
Our forecast for the USD/CAD remains on the bearish side since it is trading below the 21 SMA (1.2490) and below the 200 EMA (1.2630). There is a possibility that any bullish attempt will only be an opportunity to continue selling the pair.
The price range can be defined between the maximum of 1.2630, where the EMA of 200 is located and the support of 2/8 of murray at 1.2451, it is likely that this will be the oscillating movement of the loonie for the next few days.
Support and Resistance Levels for October 12 - 13, 2021
Resistance (3) 1,2545
Resistance (2) 1,2518
Resistance (1) 1,2499
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Support (1) 1,2425
Support (2) 1,2404
Support (3) 1,2329
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A trading tip for USD/CAD for October 12 - 13, 2021
Buy above 1,2451 (2/8) with the take profit at 1,2490 and 1,2630 (EMA 200), the stop loss is below 1,2410.