USD/CAD bulls eyeing 1.28 resistance ahead of Bank of Canada
- In data-light Monday the market is mainly driven by news from the US-China trade war developments.
- The Bank of Canada business outlook survey is slated at 14:45 GMT.
- The bulls are eying the 1.28 resistance to reach 1.2849 swing high.
The USD/CAD is trading at around 1.2784 virtually unchanged on Monday as the economic calendar is rather light except for the Bank of Canada business outlook survey which is scheduled at 14:45 GMT.
In the absence of significant macroeconomic news, the market is mainly driven by trade war news from the US and China. The US Dollar Index, which measures the value of the US dollar relative to a basket of foreign currencies is trading lower on the day and is currently testing the $90 mark.
Weekly chart
The USD/CAD is trading near last week’s close which was at 1.2781. The pair is slowly drifting lower using the 50-period weekly simple moving average as support. Last week low is at 1.2731 while the 200-period simple moving average is at 1.2712. Therefore creating a support zone with the 1.27 figure forming the 1.27-1.2731 support area. Resistance on the weekly chart is seen at 1.2895 (open of last week) and the 1.2945 (high of last two weeks), forming a resistance zone in the 1.2895-1.2945 area.
Daily chart
The USD/CAD is trading above Friday’s close at 1.2781 and bulls are currently testing the March, 27 low at 1.2812. The bulls’objective is to reach the 1.2895-1.2945 resistance area. Bears are attempting to make the bull breakout above Friday’s high fail.
4-hour chart
On the 4-hour chart, the bull’s objective is to break above the 1.28 psychological figure, which is acting as immediate resistance. The bullish aim is to reach the 1.2849 swing high. On the other hand, bears see the 1.2750 level as the psychological support level to break to the downside in order to reach lower prices. The next scaling point lower is seen at 1.2614 swing low made on February, 26. The Relative Strength Index (RSI) and the Moving Average Convergence/Divergence (MACD) indicators are currently showing a bullish diversion with the price action suggesting that a pullback toward 1.2849 can be a possibility.