The loonie stalled after Canada’s mixed employment data in August. The pair has previously broken below the demand zone at 86.60, putting buyers on the defensive.
The latest rebound has turned out to be a dead cat bounce after the price saw strong selling pressure at 87.35. An overbought RSI was an opportunity for sellers to step in.
Sentiment remains bearish in line with the downtrend initiated in early June. 86.40 is the last line of defence for the bulls and a fall below may trigger a sell-off to 85.50.
