USD/CAD bounces off 50-day SMA
2023.11.17 05:56
- USDCAD experienced a setback, falling below the 1.3800 handle
- But quickly found its feet at the 50-day SMA and recouped some losses
- Momentum indicators suggest a cautiously bullish tone
USDCAD had been in a steady advance since July, posting a fresh 13-month peak of 1.3898 on November 2. Since then, the pair has experienced two rounds of weakness, but both attempted declines got curbed by the ascending 50-day simple moving average (SMA).
Given that the momentum indicators are tilted to the upside, the bulls could initially attack the October resistance of 1.3784. A violation of that zone could trigger an advance towards the March peak of 1.3860. Failing to halt there, the price could revisit its 2023 peak of 1.3898, which is also a 13-month high.
On the flipside, should the price reverse lower, the recent support of 1.3653, which overlaps with the 50-day SMA, could act as the first line of defense. Sliding beneath that floor, the pair could test the November bottom of 1.3628. Further retreats could then cease at the October low of 1.3568.
In brief, has been experiencing some volatile moves lately, which is also evident by the widening Bollinger bands. However, the bullish medium-term structure of higher lows remains intact as the 50-day SMA has repeatedly repelled any declines.
