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USD/CAD: technical analysis 04.05.20

Current trend

On the 4-hour chart, USD/CAD quotes attempted to grow, but reaching 1.41497 mark moved to a downward correction. If the sellers manage to decline the rate below the level of 1.40991, the correction can continue to the area of 1.40748-1.40600. The breakdown of the lower border can accelerate the pair towards 1.40381 support.

Alternative scenario

If USD/CAD cannot consolidate below the level of 1.40991 during short term-period the upward trend restoration and retest of the level 1.41497 and 1.41602 are possible. The second one seems a strong resistance level, which can activate a downward rebound. However, the breakout of 1.41602 could trigger a pair’s fresh run-up to a two-week high surrounding 1.41935- 1.42000.

Technical indicators

Technical indicators mostly keep a buy signal, but the downward correction is possible in the short term.

Bollinger Bands are diverging on the background of bullish momentum.

MACD is growing in a positive zone.

Stochastic is preparing to exit the overbought zone and is directed downwards, signaling the development of a downward correction.

Support and resistance

Support levels: 1.40991, 1.40748. 1.40600, 1.40381.
Resistance levels: 1.41602, 1.41935, 1.42200.

Trading recommendations

Short positions can be opened below the level of 1.40991 with the target at around 1.40600 and stop-loss at 1.41121.
Long positions can be opened above the level of 1.41602 with the target at around 1.41935 and stop-loss at 1.41490.

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