1.3283-96 area is home to swing areas from back in April
The USDCAD has moved sharply lower after a generally weaker US jobs report and a generally stronger Canada jobs report.
The price was hanging mostlty above the pairs 100 day MA at 1.3348 for the most of the day before the jobs reports (the low was at 1.3345 and traded at 1.3362 before the report). The jobs data has sent the price tumbling to a low of 1.3292 (so far). We trade just off that level now.
Looking at the 4-hour chart, the pairs fall has moved the price into a swing area defined by swing lows in the 1.32836 and 1.32966 range. There are 4 separate runs in that area back in April, and a failed run below the lows that extended to 1.3273. Key area for the pair. A break below opens the door for more downside momentum. The 200 day MA is at 1.32656 and will be another key target on the downside (see green line on the chart below).
What would ruin the bearish trend move?
When the price has a sharp run lower (or higher), I like to gauge trend momentum by having corrections stay below the 38.2-50% retracement area. Moves above the midpoint would muddy the water for a trend like move. Staying below the 38.2% keeps the trend more firmly in tact.
For the USDCAD correction has so far been very modest.
The pair has slowed the fall at the swing area, ....but the buyers are not actually lighting the world on fire.
