The loonie was the biggest loser in trading yesterday as poor risk sentiment, softer commodities, and lower oil prices weighed on the currency. Most of the overnight moves are starting to fade and we're seeing a bit of a recovery in the loonie as a result.
Right now, USD/CAD looks on track to test the 100-hour MA (red line) @ 1.3116. For buyers, stay above and near-term bias remains bullish but given the macro theme dominating the start of trading it's hard to build a conviction to defend the level for the time being.
The more prominent support level will be the 200-hour MA (blue line) instead @ 1.3071. In early trading yesterday, sellers attempted to move below said level but a firm break ultimately failed and the pair recovered to trade near one-week highs @ 1.3177 during US trading.
The somewhat double-top pattern saw quite a rejection as the dollar also surrendered gains thereafter and has been steadily moving lower as the new day begins. There's nothing notable in the European trading calendar to shake things up so trading today will still highly depend on the ebb and flow in markets.
Keep an eye on risk sentiment - in particular equities, metals, and oil for an indication of any further run lower in the pair (and other commodity currencies as well).