USD/CAD likely to revisit the 50-DMA near 1.3420/1.3385 – SocGen

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CAD has done well to recover 1.5% from the low of 1.3695 ten days ago against the USD. Economists at Société Générale analyze USD/CAD technical outlook.

Lack of steady upward momentum

USD/CAD rebound faced stiff resistance at the hurdle of 1.3670/1.3720 representing highs of April/May and the 61.8% retracement from last October. 

Daily MACD has dipped below its trigger denoting lack of steady upward momentum. 

The pair has started unfolding a pullback after this test and is likely to revisit the 50-DMA near 1.3420/1.3385 which is a potential support zone. In case the pair fails to defend it, there could be risk of a deeper decline.