The USD/CAD pair climbed as much as 1.3276 today, registering a new high. Now, it has dropped a little trying to test and retest the immediate support levels before jumping higher. In the short term, the bias is bullish, but a temporary retreat is natural after its amazing rally.
The new leg higher was natural after the Canadian CPI reported a 0.4% growth versus 0.7% growth in the previous reporting period, while Core CPI increased by 0.4% versus the 0.5% growth in April. On the other hand, the US economic figures came in better than expected yesterday, boosting the greenback. Tomorrow, the US is to release the Final GDP, Unemployment Claims, Final GDP Price Index, and Pending Home Sales.
USD/CAD Minor Retreat?
As you can see on the H1 chart, the USD/CAD pair developed a new leg higher after testing and retesting the broken downtrend line. Now, it has reached the upper median line (uml) and the 1.3269 resistance levels.
A retreat is natural, 1.3239 represents a static support, while the median line (ml) is seen as a dynamic support. As long as it stays above the median line (ml), the currency pair could resume its growth.
USD/CAD Outlook!
A valid breakout above 1.3269 and through the upper median line (uml) activates further growth and is seen as a new buying opportunity.
