USDCAD Entering Bullish Trend on 2-Hour Chart – Key LevelsUSDCAD Entering Bullish Trend on 2-Hour Chart – Key Levels and Analysis
The USDCAD pair is showing early signs of a potential bullish trend reversal on the 2-hour chart, as price action has formed a Higher High, indicating a shift in market structure. This pattern suggests that buyers are gradually gaining control, which could lead to further upside momentum if the trend continues. However, in the short term, the pair may still experience some bearish pressure before confirming a full bullish breakout.
Current Market Structure and Bullish Indications
- The formation of a Higher High signals that the downtrend may be weakening, and buyers are stepping in at higher levels.
- If the price holds above recent swing lows, it could confirm the beginning of a new uptrend phase.
- However, traders should remain cautious, as a temporary pullback or consolidation is possible before a sustained upward move.
Key Support Level: 1.35500
On the downside, 1.35500 is a critical support zone. This level has previously acted as both resistance and support, making it a strong area for buyers to defend.
- Bullish Scenario: If the price bounces from 1.35500, it could reinforce the bullish outlook and provide a base for further upward movement.
- Bearish Risk: A decisive break below this level could delay the bullish reversal and lead to a deeper retracement toward 1.35000 or lower.
Upside Targets: 1.37450 & 1.38000
If the bullish momentum strengthens, the next key resistance levels to watch are:
1. 1.37450 – A break above this level could accelerate buying interest.
2. 1.38000 – A major psychological and technical resistance zone where profit-taking may occur.
Short-Term Bearish Possibility Before Bullish Continuation
Despite the bullish signals, the pair may still face short-term bearish pressure due to:
- Profit-taking near resistance levels.
- Potential USD weakness or CAD strength in upcoming sessions.
- Market consolidation before the next directional move.
Trading Strategy & Key Takeaways
- Confirmation Needed: Wait for a strong close above recent highs to confirm the bullish trend.
- Support Watch: A hold above 1.35500 keeps the bullish structure intact.
- Targets: If bullish momentum continues, 1.37450 and 1.38000 are the next key objectives.
- Risk Management: A break below 1.35500 could invalidate the bullish setup, leading to a reassessment of the trend.
Conclusion
The USDCAD is showing early signs of a bullish reversal on the 2-hour chart, but traders should remain cautious of short-term bearish retracements. The critical levels to watch are 1.35500 (support) and 1.37450–1.38000 (resistance targets). A confirmed breakout above resistance could signal a stronger bullish trend, while a breakdown below support may extend the correction phase. Proper risk management and confirmation through price action will be essential for successful trading in this scenario.
