USDCAD Finalizes Symmetrical Triangle Formation

Technical analysis of Forex market

USDCAD had another uneventful week as it was congested within the 1.33 area. According to the RSI and the MACD the pair is likely to continue consolidating in the short-term as both indicators show no clear direction. Yet and more interesting, the market seems to be completing a symmetrical triangle, hinting that the sideways move may soon come to an end.

A breakout from the upper trendline currently seen around 1.34 would mark the start of a bullish phase, while only a close above 1.3445 would confirm a growing uptrend. Further up, the area between 1.3540-1.3600 has been a key resistance area during 2016-2017 and therefore should be in focus.

Following a breakdown of the lower bar near 1.3350, negative sentiment would heat up, with the bears probably taking full control under 1.3285. Lower, the 200-day simple moving average (1.3190) could trigger a more aggressive sell-off if the line fails to stop downside movements, shifting attention towards the 1.3111 and 1.3067 troughs.

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Meanwhile in the medium-term picture, conditions are neutral as well, with the pair hovering within the 1.3466-1.3067 boundaries. Any violation at these points would change the outlook accordingly.

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