Dollah traders huddle up!
USD/CAD’s upswing is hitting a ceiling around a key technical resistance area.
Will the pair maintain its range pattern? Or will we see a breakout?
USD/CAD 4-hour Forex Chart by TradingView
In case you missed it, the U.S. dollar gained a few pips against its counterparts as traders eased up on their Fed rate cut speculations after Friday’s U.S. NFP report and ahead of this week’s FOMC meeting minutes and U.S. CPI and PPI releases.
Meanwhile, the Canadian dollar has lost a few pips to its safe haven counterparts while traders worry about Middle East tensions and not-so-dovish Fed expectations.
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your homework on the U.S. and Canadian dollars, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
USD/CAD, which has been trading in an uptrend since late September, is poppin’ up tall wicks around the 1.3650 level. Coincidentally, the psychological level lines up with a resistance from back in September and the R1 (1.3618) Pivot Point line in the 4-hour time frame.
Can USD/CAD bears hold the fort at the range resistance area?
Watch out for more wicks and bearish candlesticks, which could draw in selling pressure and start a downswing that could take USD/CAD to its 1.3550 Pivot Point and mid-range levels.
If it turns out that USD/CAD is just taking a breather, then the pair could be in for more gains. Keep an eye out for new October highs and sustained trading above the 1.3650 area which opens up a possible move to the 1.3700 psychological handle or the 1.3750 previous area of interest.
Whichever bias you end up trading, don’t forget to practice proper risk management and stay aware of top-tier market catalysts when trading this one. Good luck!
