USDCAD tests key support

The Canadian dollar stalled after a surprise rise in unemployment in August. The pair has met stiff selling pressure at the July peak (1.3200). A fall below the consolidation range at 1.3070 caused leveraged short-term positions to liquidate. The daily support at 1.2900 is a key level to gauge the strength of the current rally. The RSI’s oversold condition has triggered a ‘buy-the-dips’ behavior but buyers need to lift 1.3100 before the uptrend could resume. A bearish breakout could dent the optimism in the medium-term.

XAGUSD bounces higher

Silver inches higher as the US dollar falls from profit-taking across the board. On the daily chart, the precious metal found support at the origin (17.60) of the parabolic rise in July 2020. A close above 18.50 has given the bulls more confidence to extend the recovery. 19.40 is a major roadblock ahead and strong pressure could be expected from this former liquidation point. But its breach could extend gains past the psychological level of 20.00. 18.40 has turned into a fresh support in case of a consolidation.

GER 40 attempts to rebound

The Dax 40 recoups losses as traders reposition ahead of CPI this week. The bulls are looking to safeguard the summer rebound by keeping it off the critical demand zone around 12450. A surge above 13050 has prompted short-term sellers to cover their bets, easing the bearish pressure. 13340 near the 30-day moving average and the start of a stalled rebound is an area of interest. A breakout may attract momentum buying and lift the index to 13700. On the downside, 12900 is a fresh support if the rally loses steam.

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