With the dollar holding lower today, sellers are looking to take advantage of the added momentum with price now testing the 1.3400 mark. But upon the break of the 100-day moving average (red line), buyers have certainly lost control as the overall bias starts to shift slightly in favour of sellers at this point.
The August drop below the key level noted above was arrested by the 200-day moving average (blue line) at the time and currently, that level is sitting far away at 1.3149. That is not to say that USD/CAD is poised for a drop of such proportions, but it is a potential target in the long-term if dollar appetite continues to wane.
But for now, sellers will be looking to try and at least take a run back towards the November lows at 1.3225-35 next.
That said, trading sentiment in USD/CAD hasn't been as straightforward as other commodity currency pairs. The loonie itself has been dragged down by lower oil prices as of late and that will continue to be another factor of consideration alongside the risk mood and general dollar sentiment this week.
