USD/CAD: Attention on the 1.3486 June low after breaking below 200-DMA at 1.3512 – Credit Suisse

USD/CAD is breaking lower, removing the crucial 200-day average at 1.3512. A close below this level today would reinforce the downside bias of the Credit Suisse analyst team, with support next at the 1.3486 June low.

Key quotes

“USD/CAD is seeing the expected attempt to break below the pivotal 200-day average, currently at 1.3512, turning the focus onto next support at the June low at 1.3486. Although a rebound from the range bottom should clearly not be excluded, we remain biased lower and look for a close below these key levels.” 

“With a large bearish ‘descending triangle’ continuation pattern also still in place and MACD close to crossing lower, our core bias stays bearish and a move below 1.3486 would finally complete a bear ‘wedge’ continuation pattern. The next supports would then be seen back at 1.3402/3398 initially, then the more important 2020 low and retracement support at 1.3331/17.”

“Resistance is seen initially at 1.3511/12, then 1.3539, which ideally holds to keep the immediate downside bias intact. Above here though would see resistance next at 1.3600/07, where we would expect another attempt to cap.”