Forex technical analysis: USDCAD runs to swing area

Technical Analysis

Author: Greg Michalowski | usdcad

USD pressure and higher oil (helping CAD) lead to technical break

The USD is under pressure. Feds Yellen said that she was not sure inflation is indeed transitory and durable goods data was weaker.  Oil is also higher and traded above the $58.00 level (2 year high).  That is helping to support the loonie. 

Technically, today, the pair fell back below the 100 hour MA earlier in the session AND stalled against the level on 2 separate tests (see blue line in the hourly chart above).  That was an invitation for the shorts (and a signal for buyers too). The wander lower has been choppy but the last couple hours has seen a run lower through a lower trend line and away from the 200 hour MA (green line at 1.27513).  The pair has entered a swing area (see red numbered circles) in the 1.27125-218 area.  A move below that area will next look toward the 1.2700 level. Not only is a natural "round number" level, but it also was swing lows from November 6 and again on November 14.   

So sellers are in control, but lower targets are being tested that may give cause for pause. 

PS The USDJPY continues to move lower. It fell below the 200 and 100 day MAs at 111.71 and 111.68 and have remained below since the break (bearish). It tests 111.50.

PSS Gold is up about $10.50. It is following the USD .

PSS US yields are all in the red for the day with the 2 year down 2.8 bp. The 5 year down -3.1 bp. The 10 year down -2 bp.