USDCAD slides: Is a freefall to 1.3700 next?
Overview: USDCAD experienced two sharp daily declines following a pullback from both its short-term downtrend line and the 1.3940 resistance zone. This drop pushed the price below the 20- and 200-day SMAs, reinforcing a bearish outlook.
Momentum: Technical indicators reflect this ongoing downward pressure. The MACD continues to build negative momentum below the zero line and is on the verge of crossing below its signal line. The RSI remains subdued, moving sideways below the 50 mark.
Bearish Scenario: Following the selling of the past two days, a brief bullish pullback toward the 200-day SMA near 1.3830 may occur before the downtrend resumes. A continuation lower would target the 1.3730 support, followed by the psychological key level at 1.3700.
Risk: A sustained break above the 20-day SMA at 1.3860 would invalidate the immediate downside bias and potentially trigger a broader upward recovery.
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