USDCAD had an aggressive bullish rally on Thursday, moving towards the psychological number of 1.2700, but the Canadian jobs report later in the day could strengthen the loonie. The pair is flirting with the 20-day simple moving average (SMA) and fails to sustain buyers’ interest.
Technically, the MACD oscillator is gaining momentum above its trigger line and below the zero level, while the RSI appears flat near the neutral 50 threshold. In trend indicators, simple moving averages ( 20- and 40-day SMA) exhibited a bearish crossover in previous sessions, mirroring the bearish move from the 18-month high of 1.2960.
Should the pair stretch north, the 40-day SMA at 1.2760 could provide immediate resistance before the pair hits the 1.2890 barrier. A significant step higher could reinstate the bullish sentiment, likely sending the price towards the 1.2960 barrier.
On the other hand, the 200-day SMA currently at 1.2655 may halt bearish moves, while further down it may encounter support at 1.2517. If traders continue to sell the pair, the price could reach the 1.2450-1.2400 region ahead of 1.2285.
In summary, the market should remain bullish in the very short term if the pair jumps above the short term SMAs. However, overall the outlook is still neutral to bullish.