GBPCAD Stops Below 40-SMA; Stands in Ascending Channel

Technical analysis of Forex market

GBPCAD is holding below the 20- and 40-simple moving averages (SMAs) in the daily timeframe, following the bounce off the resistance level of 1.7530 – a seven-month high reached on January 25. The pair has been trading within an ascending sloping channel over the last six months, despite the upside spikes towards 1.7530. The RSI indicator is flattening slightly below the 50 level, while the MACD stands below the trigger and zero lines.

Further declines may meet support around the lower channel line, which stands near the 1.6800 strong psychological level. More losses could endorse the long-term bearish view and drive the price until the 1.6755 – 1.6700 support zone, while even lower, the pair could hit the October 2017 low of 1.6380.

On the upside, resistance could occur around the 40- and then at the 20- SMAs at 1.7112 and 1.7190 respectively. Higher still, the next resistance could come from the upper band of the channel around 1.7450.

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Overall, the medium-term picture continues to look predominantly bullish with trading activity remaining within the upward sloping channel.

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