The GBP/CAD cross fell to its lowest level in four days, down to 1.9929 as oil prices extended their latest recovery this Monday, leading to some gains in the Canadian dollar, while the Pound was unable to attract investors, despite a better mood across the financial world.
The daily decline stalled short from the 1.9860 region, a major static support from where the pair bounced multiple times by the end of January. At time of writing, GBP/CAD is trading at 1.9955, 0.65% below its opening price.
GBP/CAD technical perspective
"Nevertheless, the technical outlook is bearish for Tuesday, as the 1 hour chart shows that the price is acce lerating below a bearish 20 SMA, while the technical indicators head lower below their mid-lines", said Valeria Bednarik, chief analyst at FXStreet. "In the 4 hours chart, the downward potential is sharper with the technical indicators heading south near oversold territory, and the 20 SMA heading lower around 2.0120. Should oil's recovery continue and British data disappoint, the cross may well break below the mentioned critical support area, albeit oil sustained gains are still in doubt, and therefore the bearish trend of the GBP/CAD".
Support levels: 1.9910 1.9860 1.9800. Resistance levels: 1.9990 2.0065 2.0120.