USD/CAD is retreating from the strong resistance level of 6/8 Murray that it came to test on December 20 for the third consecutive day. The pair is now approaching the zone of the 21 SMA located at 1.2786.
In our analysis on December 21, we noted that USD/CAD gave a signal of an imminent technical correction because the eagle indicator had reached the extreme overbought zone. We invite you to read this article and get some details of this strategy.
At the beginning of the American session, the loonie is trading at 1.2820, close to the moving average of 21 located at 1.2786. Given that we have seen a technical correction for three consecutive days, it is likely that in the next few hours there will be a technical bounce above 5/8 Murray or above the 21 SMA (1.2786).
The daily chart shows that USD/CAD is keeping its uptrend intact. The trend started on October 24, and it is likely that the pair can reach the key target and the psychological level of 1.3000 in the next few days.
According to our forecast for the next few hours, the loonie is expected to consolidate above 5/8 of Murray (1.2817) or above 21 SMA (1.2786). So, we can buy with targets at 1.2875, 1.2939 (6/8), and finally at 1.3061 (7/8). If the pair trades below 1.2760, we should avoid buying.
Support and Resistance Levels for December 23 - 24, 2021
Resistance (3) 1.2939
Resistance (2) 1.2892
Resistance (1) 1.2861
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Support (1) 1.2786
Support (2) 1.2769
Support (3) 1.2702
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A trading tip for USD/CAD on December 23 - 24, 2021
Buy above 1.2786 (21 SMA) or above 1.2817 (5/8) with take profit at 1.2939 (6/8) and 1.3061 (7/8), stop loss below 1.2750.
