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The Canadian dollar has broken the downtrend channel that came from September 28. Now USD/CAD is consolidating above the 21 SMA. There is a probability that the upward movement can continue until the 200 EMA located at the psychological level of 1.25.
A solid barrier is at the 1.2399 level, if you notice on the 4-hour chart. On October 15, USD / CAD tried to break this level, but it could not. This kept the pair under downward pressure and it fell to 1.2287.
Therefore, we expect the 1.2399 level to be broken. Only on such conditions, the Canadian dollar can rise to the 200 EMA at 1.2510. On the contrary, a technical bounce around the 21 SMA could be a good opportunity to buy. Alternatively, if the pair falls a little lower around the 1/8 murray support at 1.2329, it will be considered a buy option as well.
We should avoid buying this pair if it consolidates below 1.2330 in the next few days. This would mean that the main downtrend has resumed and the pair could fall as low as 0/8 of a murray located at 1.2207.
Our forecast is to buy USD / CAD in the next few days, only if it remains above 1/8 of a murray and above the 21 SMA. Our target can be placed at 1.2510 (200 EMA) and, if the price exceeds this level, we can continue buying until 1.2573. There is the resistance of 3/8 of murray that represents a range zone.
The eagle indicator is showing a bullish signal and we believe that a technical bounce could be a good opportunity to buy. In the chart, we can see the formation of an uptrend channel that has been coming since October 21. A bounce at the bottom of the channel will be a good opportunity to buy. A stop loss must be below 1/8 murray.
Support and Resistance Levels for October 26 - 27, 2021
Resistance (3) 1.2451
Resistance (2) 1.2434
Resistance (1) 1.2407
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Support (1) 1.2353
Support (2) 1.2329
Support (3) 1.2293
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A trading tip for USD/CAD for October 26 - 27, 2021
Buy in case of a bounce off 1.2360 (SMA 21) with take profit at 1.2510 (EMA 200) and stop loss below 1.2325.
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