The USD/CAD currency pair was stranded between the 100– and 200-hour SMAs during the first half of Wednesday, as traders were reluctant to push in any direction.
However, bears started to overwhelm the market mid-session as a result of which a medium-term channel, the 200-hour SMA and the monthly PP were breached circa 1.2750.
Downside risks remained dominant until mid-Thursday when disappointing Canadian Retail Sales strengthened the Greenback. Prior to this move, technical indicators were located near historic lows. Thus, the base scenario favours a possible surge.
The rate faces a strong resistance of the 55-, 200– and 100-hour SMAs and the monthly PP circa 1.2760. This may mark a point of reversal, thus allowing the US Dollar to make a successful retracement from the channel.