EURCAD has been trending higher on its hourly time frame, forming higher lows and higher highs inside a rising channel. Price bounced off the top of the channel and might be in for a dip to support again.

The Fibonacci retracement tool shows that the bottom of the channel coincides with the 61.8% level around the 1.3500 major psychological mark. A shallow pullback could already find buyers at the 38.2% Fib, which lines up with the mid-channel area of interest.

The 100 SMA is above the 200 SMA to indicate that the path of least resistance is to the upside or that support levels are more likely to hold than to break. In that case, EURCAD could soon make its way back up to the swing high near 1.3600 or higher.

The gap between the moving averages is also widening to reflect strengthening bullish momentum, and the 100 SMA lines up with the channel bottom to add to its strength as a floor.

Meanwhile Stochastic is already indicating oversold conditions or exhaustion among sellers. Turning higher would signal that buyers are returning and could allow the uptrend to resume right away.

RSI has more room to head south, so the correction could keep going until the oscillator reaches the oversold region and turns back up.

Canada is scheduled to print another batch of CPI readings later today, and strong results could reinforce expectations of another BOC interest rate hike. Weaker than expected data, on the other hand, might mean losses for the Loonie.

Also, crude oil prices have been on the decline after Biden’s announcement to release 10-15 million barrels from the Strategic Petroleum Reserves. This would counter the OPEC’s move to curb production and put upside pressure on global supply, which then drives crude oil and the correlated Loonie lower.