USD/CAD Forecast: Downside Target at 1.4150 Ahead of Canadian CPI Data

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The USD/CAD pair is trading in positive territory around 1.4205 during the early European session on Tuesday, supported by a stronger US Dollar. Later in the day, the Canadian Consumer Price Index (CPI) inflation data for January will be in focus.

The headline CPI is expected to show a 1.8% year-over-year increase in January, with a monthly rise of 0.1% following a 0.4% decline in December.

On the 4-hour chart, the bearish outlook for USD/CAD remains intact, as the pair is trading below the key 100-period Exponential Moving Average (EMA). The Relative Strength Index (RSI) stands below the midline at 46.25, indicating continued downward momentum and favoring sellers in the near term.

Initial support is seen at 1.4151, the low from February 14. If the pair breaks below this level, it could fall to 1.4130, the lower boundary of the Bollinger Band, with further support at the psychological 1.4100 level.

On the upside, the first resistance level is near 1.4265, the upper boundary of the Bollinger Band. A decisive break above this could push the pair to 1.4310, the 100-period EMA. Further gains could lead to a rally toward the next resistance at 1.4380, the high from February 10.

Paraphrasing text from "FXSTREET" all rights reserved by the original author