USD/CAD Price Analysis: Eases below 1.2700 amid sluggish momentum

• USD/CAD refreshes intraday low, fades Friday’s recovery moves inside nearby rising channel.
• Convergence of 200-SMA, channel’s support challenges sellers, bulls have a bumpy road to the north as Momentum line retreats.

USD/CAD takes offers to refresh intraday low to 1.2665, down 0.20% on a day during early Monday. In doing so, the loonie pair refrains from extending Friday’s recovery moves but stays inside an eight-day-old rising channel.

Given the latest weakness in the Momentum line, which coincided with the pullback moves, USD/CAD may extend the latest losses towards the 1.2600 threshold.

However, a confluence of 200-SMA and the stated channel’s support line, near 1.2590, becomes a tough nut to crack for the USD/CAD bears, which if broken won’t hesitate can refresh the monthly low, currently around 1.2490.

On the flip side, a horizontal area from August 27 guards short-term USD/CAD upside around 1.2710, a break of which could push the prices towards the channel’s resistance line close to 1.2765.

In a case where USD/CAD bulls keep reins past 1.2765, July’s high around 1.2810 and the yearly peak near 1.2950 will be in focus.

Overall, USD/CAD signals further weakness but no green pass for bears before 1.2590.

USD/CAD: Four-hour chart

Trend: Further weakness expected