USD/CAD plunges in the session, down 1.26% eyes 1.2600

• The USD/CAD slumps in the session, influenced by rising oil prices and US dollar weakness.
• An evening-star candle pattern is in the making, USD/CAD could slump lower.
• Strong support lies around the 1.2485-1.2500 range.

The USD/CAD plunged in the session trades at 1.2658, down 1.27% in the game. The spike in Oil prices amid US dollar weakness, helps the loonie in the day and remains the strongest of the G8 currencies within the session.

Daily technical outlook

The USD/CAD slumps in the session, the pair is at 1.2650 and tests April 21 high at 1.2653. If the pair closes below 1.2650, further losses are expected, with a target of 1.2400-21 range. Adding to this, an evening-star candle chart pattern is in the making, however, we have to wait for the daily close for more confirmation.

On the way towards 1.2400, the next support is 1.2600, followed by the confluence of an up trendline and the 200-day moving average around 1.2553, followed by another confluence, the 100-DMA and the June 21 high at 1.2489, and then 1.2400.

RSI is at 55.35 and headed towards lower readings. A piercing of the 50 level could accelerate the downward trend, while the Average True Range is 85 pips and edges higher.

4-hour technical outlook

Zooming in on the loonie, price tests the 50-simple moving average at 1.2637. If the price aims lower, then we could test the confluence of the 100 and 200-SMA’s, followed by the June 21 high at 1.2489  and then 1.2400.

On the other hand, buyers will need the 50-SMA to hold, then a challenge of the Fibo 50% retracement at 1.2722/50, followed by the 38% Fibo retracement at the 1.2775-90 range, then  1.28000.

RSI is 38.81, heading lower while the Average True Range is 37 pips and edging higher.