• USD/CAD takes offers to refresh intraday low, snaps two-day uptrend.
• RSI retreat from overbought territory, receding bullish bias of MACD favor pullback from the key resistance line.
• 50-SMA, 61.8% Fibonacci retracement level restricts immediate downside.
• Recovery moves need validation from the yearly top.

USD/CAD stretches the previous day’s pullback from a two-month-old resistance line, the third consecutive one in September, while taking offers to refresh the intraday bottom around 1.3150 during Thursday’s Asian session.

Not only the U-turn from the key resistance line but the RSI’s retreat from the overbought territory and the receding bullish bias of the MACD also favor the USD/CAD bears.

With this, the Loonie pair is all set to revisit the 50-SMA support near 1.3100 before declining towards the 61.8% Fibonacci retracement level of the pair’s July-August downside, close to 1.3030.

It should be noted, however, that a convergence of the 200-SMA and the 50% Fibonacci retracement level around 1.2980-75 appears a tough nut to crack for the USD/CAD bears afterward.

Alternatively, recovery moves need a clear upside break of the aforementioned resistance line from July, at 1.3210 by the press time. Also acting as an upside hurdle is the yearly high marked in July at around 1.3225.

Following that, a run-up towards October 2020 peak around 1.3390 can’t be ruled out.

USD/CAD: Four-hour chart

Trend: Further weakness expected