#USDCAD @ 1.29782 -imp levels: eases from a one-month high following the release of upbeat Canadian Retail Sales.

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• USD/CAD eases from a one-month high following the release of upbeat Canadian Retail Sales.
• Weaker crude oil prices could undermine the loonie and offer support amid a stronger greenback.
• The technical set-up favours bullish traders and supports prospects for further near-term gains.

The pair currently trades last at 1.29782.

The previous day high was 1.2967 while the previous day low was 1.288. The daily 38.2% Fib levels comes at 1.2934, expected to provide support. Similarly, the daily 61.8% fib level is at 1.2914, expected to provide support.

The USD/CAD pair climbs to a one-month high during the early North American session, albeit struggles to capitalize on the move beyond the 1.3000 psychological mark. The pair trims a part of its intraday gains and is currently placed around the 1.2980-1.2975 region, still up over 0.20% for the day.

The upbeat Canadian Retail Sales figures for June offer some support to the domestic currency and act as a headwind for spot prices. That said, a weaker tone around crude oil prices should keep a lid on any meaningful upside for the commodity-linked loonie. Apart from this, the ongoing US dollar rally to its highest level since mid-July favours bullish traders and supports prospects for a further appreciating move for the USD/CAD pair.

From a technical perspective, the overnight move beyond the 1.2980-1.2985 hurdle, which coincided with the 50% Fibonacci retracement level of the July-August downfall, adds credence to the positive outlook. Furthermore, oscillators on the daily chart have just started moving into bullish territory. This, in turn, suggests that the path of least resistance for the USD/CAD pair is to the upside and dips are likely to get bought into.

Traders, however, might now wait for sustained strength beyond the 1.3000 mark before placing fresh bullish bets. The USD/CAD pair could then climb to the 61.8% Fibo. level, around the 1.3035 zone and extend the momentum further towards the next relevant hurdle near the 1.3080 area. Some follow-through buying, leading to a subsequent move above the 1.3100 mark, would mark a fresh breakout and pave the way for additional gains.

On the flip side, the 1.2930-1.2920 resistance breakpoint (38.2% Fibo. level) now seems to protect the immediate downside ahead of the 1.2900 round-figure mark. Any further decline is more likely to find decent support and remain limited near the 23.6% Fibo. level, around the 1.2845-1.2840 region. Failure to defend the said support level would negate any near-term positive bias and turn the USD/CAD pair vulnerable to slide further.

The downward trajectory could then drag spot prices to the 1.2800 round-figure mark en route to the very important 200 DMA support, currently near the 1.2755 region. This is followed by the monthly low, around the 1.2730-1.2725 region, which should act as a pivotal point. A convincing break below would be seen as a fresh trigger for bears.

Key levels to watch

Technical Levels: Supports and Resistances

USDCAD currently trading at 1.298 at the time of writing. Pair opened at 1.2951 and is trading with a change of 0.22 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 1.2857, 50 SMA 1.2908, 100 SMA @ 1.2815 and 200 SMA @ 1.2754.

The previous day high was 1.2967 while the previous day low was 1.288. The daily 38.2% Fib levels comes at 1.2934, expected to provide support. Similarly, the daily 61.8% fib level is at 1.2914, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1.2899, 1.2846, 1.2812
• Pivot resistance is noted at 1.2985, 1.3019, 1.3072

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