FX.co ★ USD/CAD drops sharply ahead of US data

The USD/CAD pair is trading in the red corridor at 1.3489 on the H1 at the time of writing. It signaled that the upside movement is over and that the sellers could take the lead. It declined sharply as the US dollar index lost ground.

Later, the US economic figures could be decisive. Worse-than-expected data could send the USD/CAD toward fresh new lows. The Richmond Manufacturing Index and the Pending Home Sales will be published. Only better-than-expected data could help USD to rebound.

USD/CAD Under Massive Pressure

Technically, the USD/CAD was somehow expected to develop a larger drop after breaking below the uptrend line. It dipped below the 1.3561 and 1.3521 support levels signaling downside pressure.

It tried to rebound but it failed to stay above 1.3521 and above the lower median line (lml). It may hit 1.3484.

USD/CAD Prediction

A valid breakout below 1.3484 and through the S2 (1.3480) brings new selling opportunities. The weekly S3 (1.3390) represents a downside target.