Correction lower stalls above 200 hour MA and 38.2%
The USDCAD raced higher in early Asian trading, moving to the highest level since April 23rd. The earlier run higher extended above a swing area at 1.4113-198, but two separate moves above that area failed.. The price action has started to use that level as resistance over the last few hours (see red numbered circle 9). That is close resistance now.
On the downside today, the 1.4072-82 was a swing area on April 27 and 28 last week (see green numbered circles). Admittedly, the price moved above and below the level on Friday. Today, the price tried to base there, cracked below but found buyers at the 1.40493 area which was a late day low on Friday. The current bar reestablished the swing area at 1.40726 to 1.40829 (see green numbered 6 circle) as support. We trade just above that area now.
So, the run higher failed above a swing area (above 1.41198). The run lower failed below a swing area below 1.40726).
If the downside swing area is broken, the target is the 1.40493 followed by the 200 hour MA and the 38.2% retracement at 1.40359. Break below that and the door opens for more selling.
On the topside, get back above 1.41131-198 and the high for the day at 1.4151 opens the door for more upside momentum.
