- USD/CAD edges lower to around 1.3720 in Tuesday’s early European session.
- The pair keeps the negative outlook below the 100-day EMA with a bearish RSI indicator.
- The initial support emerges at 1.3635; the first upside barrier is located at 1.3820.
The USD/CAD pair trades in negative territory around 1.3720 during the early European session on Tuesday. The Greenback weakens against the Canadian Dollar (CAD) as a ceasefire between Iran and Israel comes into effect following four waves of Iranian attacks on Israeli-occupied territories.
Furthermore, the dovish comments from the US Federal Reserve (Fed) policymakers also undermine the US Dollar (USD). Fed Governor Michelle Bowman said Monday she would favor an interest rate reduction at the next policy meeting in July so long as inflation pressures stay muted.
According to the daily chart, the bearish outlook of USD/CAD remains in play as the pair remains capped below the key 100-day Exponential Moving Average (EMA). The path of least resistance is to the downside, with the 14-day Relative Strength Index standing below the midline near 47.75.
The first downside target for the pair emerges at 1.3635, the low of June 18. Extended losses could see a drop to 1.3575, the lower limit of the Bollinger Band. The next contention level for USD/CAD is seen at 1.3540, the low of June 16.
On the bright side, the immediate resistance level is located at 1.3820, the upper boundary of the Bollinger Band. Sustained trading above this level could attract some buyers to 1.3862, the high of May 29. Further north, the next hurdle to watch is 1.3935, the 100-day EMA.
USD/CAD Daily Chart
