Forex technical analysis: USDCAD tests trendline/lows from last week

Technical Analysis

Author: Greg Michalowski | usdcad

Low from last week at 1.3398/Trend line at 1.3401  

The USDCAD is testing an upward sloping trendline  a 1.3401. The low from last week came in at 1.3398. The combination is being tested as the USD corrects in trading today.   Crude oil prices are trading up $1.28 or 2.8% to $47 per barrel. This too is helping to support the CAD (keep the USDCAD under pressure). 

A move below will next target the 38.2% retracement of the move up from the October low.  That level comes in at 1.33651.  The 50% retracement comes in at 1.32964. That llevel will also be a target on a break lower.

We are seeing that support level broken while I type.  The pair has just traded down to a low of 1.3386.  Drilling down to the hourly chart, the move has cracked the 50% and now tests the 61.8% of the move up from the Election day low. That level comes in at 1.33865.  Helping the selling bias, is the sellers that leaned against the 200 and 100 hour MAs (see green and blue line in the chart below).  The corrective high in the London morning session, found sellers against those MAs and that has helped the bearish bias in trading today.

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