- USD/CAD print losses in the Asian session on Friday.
- Bulls lose the battle near the 1.2100 mark.
- Negative MACD favors downside momentum.
The USD/CAD pair extends the previous day’s weakness onto Friday’s morning session. The pair opens up near the 1.2100, a key psychological mark, albeit fizzles out rather quickly towards the lower levels.
At the time of writing, USD/CAD trades at 1.2090, down 0.03% so far.
USD/CAD 4-hour chart
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On the 4-hour chart, the USD/CAD pair has been facing a strong resistance barrier near 1.2120 with the double top formation. USD/CAD is making a higher low pattern, where highs remain almost the same. The price is squeezing out as soon as it approaches toward the higher end.
The negative divergence in the Moving Average Convergence Divergence (MACD) indicator signifies impending selling movement. If the MACD slips below the midline, then USD bears could have the opportunity to test the 50-hour Simple Moving Average (SMA) at 1.2085.
In doing so, bears would be next aiming for the target of the 1.2070 and the 1.2050 horizontal support levels.
Alternatively, if price moves higher, then it could first claim back at the 1.2110 horizontal resistance level.
Next, market participants would like to recapture the June 4 high in the vicinity of the 1.2135 area. The bulls feel motivated to march toward the May 27 high near the 1.2145 neighbourhood.