USD/CAD Price Analysis: Stretches higher to near 1.3470 before a weekly high

• USD/CAD gains ground ahead of the BoC monetary policy decision on Wednesday.
• Technical analysis suggests a bullish trend towards a weekly high at 1.3491 and a psychological level at 1.3500.
• The 23.6% Fibonacci retracement at 1.3454 and the 1.3450 major level could act as the immediate support zone.

USD/CAD attempts to recover its recent losses ahead of the Bank of Canada (BoC) interest rate decision on Wednesday, improving higher to near 1.3470 during the Asian trading hours on Wednesday.

The technical analysis of the Moving Average Convergence Divergence (MACD) for the USD/CAD pair suggests a potential bullish sentiment in the market. This interpretation is derived from the positioning of the MACD line above the centerline and the presence of divergence above the signal line.

USD/CAD pair could find the immediate barrier at the weekly high at 1.3491 followed by the psychological resistance level at 1.3500. The pair could surpass the resistance level as indicated by the lagging indicator 14-day Relative Strength Index (RSI). The RSI is positioned above 50, suggesting the confirmation of stronger momentum for the USD/CAD pair.

On the downside, the region around the 23.6% Fibonacci retracement at 1.3454 level aligned with the major level at 1.3450 could act as the immediate support zone. A collapse below the support zone could put pressure on the USD/CAD pair to break below the 21-day Exponential Moving Average (EMA) at 1.3427 followed by the 38.2% Fibonacci retracement level at 1.3401.

USD/CAD: Daily Chart