USDCAD runs into the swing area

Technical Analysis

Author: Greg Michalowski | usdcad

The USDCAD retraces the employment move

On Friday (just a few days ago), Canada announced a strong rise in employment. The USDCAD tumbled lower (stronger CAD), but could not fall below the April 30/May 1 lows. In fact, buyers leaned.  The correction was on.  

The USDCAD retraces the employment move
Yesterday, that move got another boost from the flight out of risk (out of CAD too) 

Today, the pair moved lower, BUT found support buyers near the 100 and 200 hour MAs (blue and green lines). We are seeing a modest run higher.  

What next?

The big swatch of yellow in the chart above is about 18-19 pips. Going back to April 26th that area between 1.34797 and 1.34973, has been home to a number of swing highs (11 of the last 13 days has a green numbered circle).  Last week (on Thursday) there was a try above the upper extreme, but that failed miserably.   

Today the middle of the big swatch has stalled the rallies twice (green circles 13 and 14).  We are below that area now.  Has the most recent peak been made?  It is a trade thought, with limited risk (can get out if start to move back in the area). 

If so, the 100 and 200 hour MA becomes the target to get to and through at 1.3458-59 now.  

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