- Having repeatedly failed to near the 1.3345 supply zone, the USD/CAD pair met with some aggressive supply on Wednesday following the release of hotter-than-expected Canadian CPI report.
- The pair has now dropped back to the lower end of its weekly trading range – around mid-1.3200s – which if broken decisively will set the stage for an extension of the ongoing corrective slide.
Meanwhile, technical indicators on the 1-hourly chart are already pointing to slightly oversold conditions and despite the pullback, maintained their bullish bias on the daily chart, warranting caution before placing any aggressive bearish bets.
However, a convincing break through the mentioned support might turn the pair vulnerable to accelerate the slide further towards challenging the 1.3200 round figure mark en-route monthly lows support near the 1.3180-75 region.
On the flip side, any attempted recovery now seems to confront some fresh supply near 200-hour SMA – around the 1.3275 region – above which the pair is likely to head back towards reclaiming the 1.3300 handle, coinciding with 100-hour SMA.