- USD/CAD posts some gains after the previous day’s steep fall.
- Bulls are facing stiff resistance near the 1.2490 mark.
- Overbought MACD looks exhaustive, warns against aggressive bids.
USD/CAD edges higher in the Asian trading hours The pair rose near to the multi-month high on Monday, however, failed to sustain the gains.
At the time of writing, USD/CAD trades at 1.2375, up 0.12% for the day.
-637599263945491294.png)
On the 4-hour chart, after testing the daily high near the 1.2490 level, USD/CAD fell sharply and took shelter at 38.2% Fibonacci retracement, which extends from the lows of 1.2157. The pair now consolidates near the 1.2370 level.
USD/CAD bulls making an effort to dominate the trade over here. The formation of three small Doji candlesticks suggests traders are reluctant to place aggressive selling bids at this level.
In doing so, the USD/CAD pair would first attempt to touch the 23.6% Fibonacci retracement level at 1.2410 followed by the 1.2450 horizontal resistance level.
The Moving Average Convergence Divergence (MACD) indicator trades in the overbought zone signaling stretched buying opportunities. Any uptick in the MACD would continue to push USD/CAD higher to test the previous day’s high at 1.2487.
Alternatively, if price moves and sustains below the session’s low, then the bears could come back in action. The first target on the bear’s radar would be the 50% Fibonacci retracement level at 1.2325.
Market participants would then aim for the 1.2270 and the 1.2220 horizontal support levels.
