Back above 1.4000/38.2% retracement
The USDCAD has move higher in trading today as oil prices traded back below the $30 level again today. The low extended toward $29.80. The price us currently trading back up at the $30.33 level currently.
IN the action today, the USDCAD has started to react more bullishly after a few days where the price has been showing more downside/corrective tendencies. The price yesterday fell to the lowest level since January 5th despite lower oil prices. The last 3 days has seen the price trade below the highs from December at 1.4000 level and below the 38.2% of the move up from the October 2015 lows (see daily chart above) at 1.39795. The pair was more bearish technically.
Today is seeing a rebound with the fall in oil below the $30.00 but with the correction off the low, some of those gains are being eroded at the moment.
Where might the pair find technical support on a dip now?
Looking at the hourly chart below, the price move higher today has taken the price back above the 100 hour MA (at the 1.40335 level currently). That is more bullish for the pair. As Adam pointed out in an earlier post, there is a head and shoulder break which is bullish as well. This area at the 1.4033 level is risk for the buyers. Move below and the gains from the breaks today, don't look so hot.
ON the topside, there is still work to do, before victory for the buyers can be declared. The 200 bar MA on the 4-hour chart comes in at 1.4089 (see step blue line in the chart below) and the the 200 hour MA (smooth blue line) is at 1.4123. Those targets need to be broken to give buyers more confidence in the bullish momentum seen in trading today.
