- USD/CAD pares intraday losses during a three-day downtrend.
- Monthly support line, challenges bears, bulls seek 200-SMA, 38.2% Fibo. breakout for fresh entry.
USD/CAD licks its wounds around 1.2630, down 0.10% intraday, ahead of Monday’s European session.
In doing so, the Loonie pair stays negative for the third consecutive day but an ascending support line from early September defends buyers.
However, a confluence of the 200-SMA and 38.2% Fibonacci retracement (Fibo.) of the late August to early September downside, near 1.2670, questions the pair’s immediate upside.
Also acting as an upside filter is a downward sloping trend line from September 20, near 1.2735.
Should the quote rise past 1.2735, 61.8% Fibo. level of 1.2775 and the last month’s top surrounding 1.2900 will be in focus.
Alternatively, a downside break of the immediate support line close to 1.2615 will be challenged by the 1.2600 threshold and the weak RSI conditions, not to forget the previous week’s swing low near 1.2590.
In a case where USD/CAD remains pressured past 1.2590, September’s low around 1.2490 should return to the chart.
USD/CAD: Four-hour chart
Trend: Corrective pullback expected