USDCAD maintains a bearish market structure as the pair continues to trade below the 200-day moving average. Looking at the short-term, prices made a corrective move higher after bouncing from 1.2061 and are currently consolidating around the 1.25 handle.
Immediate support is being provided by the 50-day MA, currently at 1.2438. Breaking below this level would target the September 8 low at 1.2061. Another leg lower would increase downside pressure and bring a resumption of the broader downtrend, with scope to reach the next major low at 1.1919.
A move to the upside would target the next high at 1.2777 ahead of the key 1.3000 level. From here, the focus turns to the 1.3215-1.3342 area. An extension higher would see a re-test of the May 5 peak at 1.3793.
In the near term USDCAD is expected to maintain a neutral bias at 7-week highs, pivoting around 1.2500. Trend strength is weak (RSI is neutral), leaving little room for a sustained push higher. The market structure on the daily chart supports a bearish view.