USD/CAD Price Analysis: Bears stays hopeful to refresh 2022 low
- USD/CAD remains on the back foot around nine-week low.
- Clear break of 61.8% Fibonacci retracement level directs bears to January’s low.
- RSI conditions may test bears around yearly low, 78.6% Fibo.
- Previous support line, 200-DMA adds to the upside filters.
USD/CAD struggles to defend the 1.2500 threshold around a two-month bottom, despite picking up bids around 1.2530 during the initial Asian session on Friday.
The loonie pair dropped to the lowest levels since January 21 the previous day on breaking the 61.8% Fibonacci retracement (Fibo.) of October-December 2021 upside amid bearish MACD signals. That said, the south-run previously gained support from a clear break of the 200-DMA and multi-day-old rising trend line.
With this, USD/CAD seems to have a smooth journey towards January 2022 low surrounding 1.2450.
However, 78.6% Fibo. level near 1.2430 will challenge the pair bears as the RSI inches closer to the oversold territory.
In a case where the USD/CAD bears conquer the 1.2430 support, the pair becomes vulnerable to test the late 2021 bottom surrounding 1.2290.
Alternatively, the corrective pullback may initially aim for the nearby key Fibonacci retracement resistance level of 1.2545.
Following that, the support-turned-resistance line and the 200-DMA, respectively around 1.2575 and 1.2615, will challenge the USD/CAD bulls.
It should be observed that February’s low near 1.2635 will act as an additional filter to the north during the pair’s upside past 1.2615.
USD/CAD: Daily chart
Trend: Further weakness expected