The USDCAD has traded to a new week low of 1.24215. That took out a earlier low for the day at 1.24255, and also the low from July 14 at 1.24227. The price traded at the lowest level since July 6.
There is a swing area between 1.24227 and 1.24490 (see yellow area in the chart above). The low did take a look below that level but only by a pip or so. The price has moved back up to 1.2430 currently. Watch 1.24377 as a potential interim close resistance level now. That was a swing low from July 9 and would give a near term clue ahead of the top of the swing area.
However, it will take a move back above 1.2449 for the dip buyers to feel that the low might be in place. Absent that, and the sellers are still in control (and the buyers are nervous).
On a move lower, traders will start to look toward the 100 day moving average down at 1.23655 as a downside target.
For the week, the high on Tuesday stalled just ahead of the 200 day moving average and the 200 hour moving average (see green lines in the chart above). Staying below those key technical levels, and moving outside of what was a 82 pip up and down trading range during yesterday's trading session, led to a doubling of that range since the break.
Now with the pair testing the lower swing area, the question is does the selling continue below the area and move toward the 100 day moving average, or do we bounce and get (and stay) above the 1.2249 area.