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    Technical Analysis – USDCAD consolidates after halting downtrend

    USDCAD has been consolidating since early May after breaking out of the downward trending channel. The downleg from 1.4689 to 1.2460 took prices below the 200-day moving average but with the recent move sideways, the medium-term outlook is looking increasingly neutral.

    The near-term bias is also neutral with the MACD flattening out around 0. The 23.6% Fibonacci level of the January-May downtrend capped prices at around 1.2980 earlier today. This is also where the 100-day moving average is converging, while the 200-day moving average is the next key resistance area at around 1.33, which is also the 38.2% Fibonacci level.

    To the downside, the 50-day moving average is the nearest support at 1.29. The neutral bias should hold as long as prices keep above the bottom of the recent range at 1.2650. A break below this level would likely shift the bias the negative.

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