USD/CAD Fails Above 1.4000 as RSI Warns 1.4024 Rally Is Overstretched

3 articles · Updated · Reuters · Jun 15

USD/CAD closed back below 1.4000 after reaching 1.4024, with Thursday’s long upper shadow signaling buyers failed to hold the breakout.
The warning comes as the daily RSI drifts sideways in overbought territory, suggesting the dollar’s latest advance against the loonie may have run too far, too fast.
That rally was underpinned by a 1.25-1.50 percentage-point U.S. rate advantage, a 10-day moving average at 1.3922, and Canada’s economy shrinking 0.1% annualized in Q1 after a revised 1.0% contraction.
For now the loonie remains under pressure, but a move back above 1.4024 could target 1.4140, while a drop below 1.3892 would tilt the outlook back in Canada’s favor.