Close but no cigar. That has been the story for USD/CAD over the past week or so as sellers continue to pressure the pair lower but unable to establish the next leg to the downside.

USDCAD D1 20-01

This comes as price keeps knocking on the door of the 200-day moving average (blue line) before bouncing and closing above the key support level by the end of the day. As such, that continues to limit any major downside momentum for now.

Will today be different? Well, with stocks having seen a rough time previously, the dollar has been managing to hold up. The loonie is helped by higher oil prices but risk sentiment is arguably still the key driver for now - as evident by how sellers have failed to really manage a breakthrough.

China's rate cut today will help to provide risk trades with some early impetus but equities aren't looking in the best of shape after yesterday's declines. As much as stocks are holding up now, sentiment remains relatively fragile.

In any case, the 200-day moving average for USD/CAD will continue to be a key point of interest in determining the next trending move for the pair. Break below and the downside is likely to accelerate. Hold above and buyers will slowly try and gather back some momentum in search for the next bounce (key hourly moving averages seen @ 1.2513-45).