The USD/CAD currency pair extended session gains on Tuesday afternoon following a string of US economic events that did not disappoint. The pair had pulled back on Monday ahead of the important day to bounce off 1.3415 before stretching session gains towards monthly highs of 1.3490.

The pair performed what looks like a mini-reversal pattern to trend upwards but that bullish run appears to be running out of steam with the top flattening.

USD/CAD Fundamentals Overview

From a fundamental perspective, the pair appears to lean towards a potential sideways movement in the intermediate time frame. The loonie will benefit from the strengthening of oil prices while the greenback will continue to rely on strong US economic data.

Based on today’s US economic events where JOLTS job openings report beat expectations and made significant improvements from the previous period, the greenback has the upper hand for now.

However, the loonie is expected to strike back with oil prices expected to remain steady ahead of the US API Weekly Crude Oil Stock report to be released at around 20:30 GMT.

USD/CAD Technical Analysis (the 240-min Chart)

Technically, the pair appears to be on a bullish trend, which might be coming o an end after flattening of the top. This is well illustrated using the XABCD pattern, which also hints a possibility of a major pullback.

Based on the current levels, the bears will be more optimistic tomorrow as they count on the key resistance zone to do its work and trigger another pullback.

They will be targetting opportunities around 1.3445. On the other hand, the bulls will hope that the pair continues to climb towards key level 1.3500.

USD/CAD Technical Analysis (the Daily Chart)

In the daily chart, the pattern becomes clearer as the pair can be seen closing on a potential consolidation within what appears to be a bullish wedge. The bigger picture also shows that the pair trades in an ascending channel, which means that long-term, the bulls maintain control.

This creates some interesting trading opportunities. The bulls will target profits around 76.40% Fib level at 1.3516 while the bears will look to strike around the 61.80% Fib level at 1.3427.

In summary, the USD/CAD currency pair appears to have long-term bullish bias but in the intermediate time frame, the battle between the loonie and the greenback is pretty even. The bears will claim control in the short-term following Tuesday’s rebound.