USD/CAD keeps lower to start the week but key near-term levels still at play

Technical Analysis

Author: Justin Low | usdcad

USD/CAD drop today defended by the 100-hour moving average again

USD/CAD H1 11-08
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The pair is keeping lower after the drop yesterday saw price action break back below its 200-hour MA (blue line). Sellers defended that level in early trades today before moving on to retest the 100-hour MA (red line) around 1.3225 earlier.

For now, buyers are hanging on to that level as well as minor support seen from Friday @ 1.3225-26. However, the 100-hour MA is the key near-term level to watch now.

Break below that and sellers will establish a more bearish near-term bias in search for a more extended fall towards 1.3300.

In the bigger picture of things, the dollar side of the equation is still the key spot to watch amid the market focus on US stimulus in general.

But oil prices are continuing to keep more steady amid the more positive risk mood to start the session and that bodes well for the loonie so far at least.

For now, it is still all about the push and pull between key near-term levels pointed out above but given the dollar's vulnerability, a break under the 100-hour MA could set off another run towards last week's lows at 1.3234-45 potentially.

That said, it is going to be tricky to figure out how the market is going to react to Trump's executive order on unemployment benefits and how stimulus negotiations in Congress are taking shape this week.

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