Tests swing area in 1.3111 area and bounces
The USDCAD has moved to a new session low. The existing home sales were stronger than expected at 4.1% (vs 1.7% expected). Oil prices are not helping the loonie as it is down -$2.30 now on reports Libya El-Feel oil field production is up to 70B bpd. The US also said today that some oil buyers could get waivers to continue buying Iranian supplies despite American sanctions. Higher oil prices in the US could hurt the Pres./GOP if prices at the pump go higher into the elections. Prices of other goods could continue higher already because of tariffs, offsetting the lower tax rates from the tax cuts.
The price of the USDCAD has just tested a swing area at 1.31115 area. The low reached 1.3109. That area could slow the fall with a momentum break below, likely triggering stops (dip buyers get out).
ON the topside today, technicals have helped to put a lid on the pair. The 100hour MA at 1.31605 (blue line in the chart above), has been a ceiling for most of the day. The 200 hour MA (green line) tried to stall the fall for most of the London session, but gave way since the better existing home data. The 200 hour MA is a level of importance. It should act as the new ceiling if the sellers are to keep in control. A move above, and a retest of the 100 hour MA will be eyed.