The USD/CAD pair has continued its downward trend for a second consecutive day, hovering around 1.3590 during early trading in Europe on Wednesday. Analyzing the daily chart reveals that the pair is situated within a descending channel, reinforcing the ongoing bearish sentiment.
In the short term, the USD/CAD retains this bearish outlook, especially as it trades below both the 9-day and 50-day exponential moving averages (EMAs). The pair has retreated from recent highs, showing a 14-day relative strength index (RSI) of roughly 37, which points to persistent selling pressure rather than a strong oversold scenario.
Looking ahead, the USD/CAD is expected to stay near 1.3473, marking its lowest point since September 2024. Should it continue to drop, there’s a chance it could reach the lower limit of the descending channel around 1.3410.
The immediate resistance is noted at the 9-day EMA positioned at 1.3630, followed closely by the descending channel boundary near 1.3650. A sustained breakthrough of this resistance zone could give rise to bullish sentiment and allow the pair to test the 50-day EMA at 1.3715. If it surpasses this medium-term average, it could even explore a five-month peak of 1.3967 reached on March 31.
(The technical analysis in this story was written with the help of AI tools.)
