USD/CAD Price Analysis: Sees more weakness below 1.3330 amid upbeat market mood

• USD/CAD is expected to deliver sheer weakness below 1.3330 amid the risk-off mood.
• A breakdown of the Ascending Triangle pattern has strengthened the Canadian Dollar.
• The Loonie is exposed to the horizontal support at 1.3226 after a breakdown of the RSI (14) into the 20.00-40.00 range.

The USD/CAD pair is hovering around the critical support of 1.3326 in the early Asian session. The Loonie asset is demonstrating signs of refreshing its eight-day low below 1.3326 as the risk appetite theme has gained sheer traction. The market mood has turned cheerful as investors have digested the consequences of a surprise rise in the United States inflation ahead.

The US Dollar Index (DXY) retreated after a pullback move to near the 103.00 resistance. S&P500 futures are showing immense strength despite the airborne threats to the United States after back-to-back unidentified flying objects near the US air base. Meanwhile, easing uncertainty for US Consumer Price Index (CPI) has pushed 10-year US Treasury yields lower to near 3.70%.

USD/CAD has delivered a downside break of the Ascending Triangle chart pattern formed on a four-hour scale. The upward-sloping trendline of the aforementioned chart pattern is placed from February 08 low at 1.3360 while the horizontal resistance is plotted from January 31 high at 1.3472. The major has slipped below the 50-period Exponential Moving Average (EMA) at 1.3385, indicating more weakness ahead.

Meanwhile, the Relative Strength Index (RSI) (14) has slipped into the bearish range of 20.00-40.00, which indicates that the downside momentum has been triggered.

A downside move below February 13 low at 1.3325 will drag the Loonie asset toward February 2 low at 1.3262. A slippage below the latter will expose the asset to the horizontal support plotted from November 15 low at 1.3226.

On the flip side, a break above February 7 high at 1.3469 will drive the asset toward January 19 high at 1.3521 followed by January 6 low at 1.3538.

USD/CAD four-hour chart