The USDCAD opened the week just below the 100-day moving average at 1.3757, but buyers quickly stepped in and pushed the pair back above both the 100- and 200-bar moving averages on the 4-hour chart. Yesterday’s dip toward those same averages attracted renewed demand, with support reinforced by the lower edge of a swing area between 1.38127 and 1.38315. In today’s session, the price has moved decisively away from that zone and is now pressing higher toward key resistance targets on the topside, including:
- August 1 high at 1.38785
- A swing area between 1.38917 and 1.3904
- The swing high from August 22, which also corresponds with the 38.2% retracement of the move down from the March high at 1.39235
The USDCAD has been confined to a 200-pip range over the past eight trading weeks, with 1.39235 capping the topside. That ceiling, along with nearby targets, should provide formidable resistance that give sellers an low risk opportunity to lean against. If the price holds below this barrier, the pair could rotate back lower toward the 100- and 200-bar moving averages on the 4-hour chart near 1.3810. Conversely, if the price moved above, I would expect the sellers to buy back with a small loss and push the price higher. The 200 day moving average at 1.3977 would be the next upside target.
The video above outlines the technicals which are driving the USDCAD.
