USD/CAD picks up bids to extend Friday’s gain around monthly top. RSI conditions can challenge bulls around upper line of short-term rising wedge. 61.8% FE restricts immediate downside, sellers will wait for 200-SMA before taking fresh entries. USD/CAD remains on the front foot around 1.2915, up 0.15% intraday heading into Monday’s European session. In doing so, the Loonie pair extends Friday’s recovery moves beyond 61.8% Fibonacci Expansion (FE) level of November 10 to December 08 moves amid firmer RSI conditions.
Given the clear break of the key FE and firmer RSI, USD/CAD prices are likely to stay firmer. However, there prevails a minor gap before the RSI line turns overbought and hints at a pullback, which in turn requires the pair buyers to remain cautious. That said, the monthly high of 1.2936, also the highest since August, lures the pair buyers of late.
However, the upper line of a short-term rising wedge bearish chart pattern and 78.6% FE level, respectively around 1.2965 and 1.2975, will challenge the quote before directing the USD/CAD bulls to the 1.3000 psychological magnet. On the contrary, pullback moves may initially target the 61.8% FE level of 1.2900 before challenging the rising wedge’s support line, around 1.2800 at the latest. It’s worth noting that a clear downside break of 1.2800 won’t be enough for the USD/CAD bears as 50-SMA and 200-SMA become the key supports around 1.2780 and 1.2670 to challenge the Loonie pair’s further weakness.
