The better data today pushed the USDCAD above and away from its 200 hour moving average green line in the chart below). That moving average had been broken on 2 separate occasions earlier today, only to fail on each attempt. The moves back down got close to the lower 100 hour moving average (blue line) at 1.26813, but did fine early buyers against that level.
The data today was the catalyst for the third break above the 200 hour moving average. This time, there is more momentum and the price is moving further away. Traders will now use that moving average as support/risk defining level. They would not want to see another fail if the buyers are to remain more in control.
Having said that, the pair is currently testing a topside trend line that cuts across at 1.2736. Just above that is the 50% retracement of the move down from the February 2 high. That comes in at 1.27391. So far traders are leaning against the area with risk defined and limited.
A break above that level and the traders will be looking toward the highs from last week starting with the Friday high at 1.27621. The Tuesday high reached 1.2765.
Oil prices moving back lower may also be helping to weaken the CAD a bit today (higher USDCAD). The Wall Street Journal is reporting that Saudi Arabia is set to reverse unilateral production cuts. WTI crude oil futures traded as high as $61.26. It is currently back below the $60 level at $59.93.