The USDCAD is testing (now breaking) to new week highs. The Monday high reach 1.21324. The price just broke above that level and traded up to 1.21397 so far. There is a swing area between 1.21324 and 1.21355. The next swing area is between 1.214153 and 1.21437. That area is from swing highs from May 19, May 20 and May 27. Break above that level and the door opened for further upside in the pair.
Helping the technicals this week were the double bottom from Monday and Wednesday at 1.20562. Yesterday and today, the price fell below its 200 hour moving average (green line) but could not sustain momentum for long. The failures below that MA, Gay buyers more confidence.
Today, those buyers have been somewhat relentless over the last seven trading hours. Of the seven, six have been to the upside (with one small decline).
The selling of the loonie is despite the rise in crude oil prices which are up about $0.50 or 0.7% at $70.78. That may be a red flag, but it would take a move back below 1.21227 to 1.21243 area to hurt the technical bullish bias. Holding below the ceiling at 1.21413 to 1.21437, could also give sellers something to lean against.
Taking a broader look at the weekly chart for the USDCAD, the pair has been scraping along the bottoms over the last 4-5 weeks. The low last week at 1.2006 was the lowest low since May 2015. This week the pair has traded mostly above the 2017 swing low of 1.20612. The lows for the week on Monday and Wednesday did extend below that low at 1.2056, but momentum could not be sustained and the price moved higher. The inability to stay below the 2017 low gives the buyers some hope. Putting it another way, the 1.20612 is a key support level again after the inability to move lower on the break. Key risk level now for dip buyers. Stay above is more bullish.