USDCAD’s dictating upside momentum has lost steam around the upper Bollinger band at 1.2827, just shy of reaching the 1.2835-1.2855 resistance boundary, stalling the minor rally from the 1.2606 mark. That said, the simple moving averages (SMAs) are still endorsing bullish sentiment.
The short-term oscillators are reflecting the slight waning in bullish momentum. The MACD, some distance above zero, is decelerating above its red trigger line, while the RSI is fading from the 70 level. The stochastic lines are in overbought territory, but the %K line has yet to confirm an increase in selling pressures.
If the price starts to surrender ground from the vicinity of the upper Bollinger band, sellers could encounter an initial zone of support existing between the 50- and 100-period SMAs at 1.2740 and 1.2727 respectively. Retracting beneath this area, the price may meet the 1.2705 low ahead of the 1.2663-1.2678 border. From here, downside constraints could then develop at the lower Bollinger band at 1.2640 before the price sinks to test the reinforced support base of 1.2583-1.2610.
Otherwise, if buyers regain control, immediate upside friction may stem from the upper Bollinger band around 1.2827 ahead of the 1.2835-1.2855 resistance band. Overshooting this two-and-a-half-month ceiling, the pair may steer for the September rally peak of 1.2895, which is just short of the 1.2900 hurdle. Should bullish momentum endure, the bulls could then aim for the 1.2933-1.2958 resistance boundary, which encompasses the August rally peak of 1.2948. If this obstruction breaks down, buyers may then pilot for the 1.3004 high.
Summarizing, USDCAD is exhibiting some weakness approaching the 1.2854 high. Yet, breaking above the 1.2835-1.2855 resistance belt could reinforce the short-term bullish bias, while a dive past the 1.2583-1.2610 support could feed negative pressures. On another note, overcoming the 1.2933-1.2958 barricade could boost the long-term bullish outlook.
