The USDCAD has trended higher in trading today and in the process has moved up to test it's 61.8% retracement at 1.2831. The high price reached 1.28346 - just above that level - and has backed off.
The low to high trading range is up to 141 pips. That is well above the 22 day average (around a month of trading) of 91 pips.
The run to the upside today started near the 100 hour MA (blue line) at 1.27013 currently, and cracked the 200 hour MA for the first time since December 29 a few hours later (green line at 1.27303 currently).
The next major target above the 200 hour moving average was the 50% retracement of the move down from the December 21 high at 1.27925. That is a close risk level on the hourly chart now. Stay above is more bullish.
In a trend day, it is important to look at the 5-minute chart for trend clues.
Looking at the chart below, there have been three legs higher so far.
The first trend step higher took the price from 1.26812 to 1.27672. The 38.2% of that move came in at 1.27329. The corrective low stalled ahead of that at 1.27403. The buyers were still in control.
The 2nd leg higher went from 1.27403 to 1.27844. The correction of that move also stalled near the 38.2% at 1.27672. The price based and started the 3rd leg higher.
The 3rd leg has seen the price move up from 1.27672 to 1.28346. The 38.2 to 50% of that individual leg higher comes in at 1.2800 to 1.28089. If the price correction off the high can stay above that area, the bullish trend day remains intact. We could see new highs. If the price moves below that area, the trend momentum is a bit weaker. We could see more balanced up and down trading.
With the price testing the 61.8% retracement on the hourly chart at the high, there is a potential that the trend might be entering a consolidation phase.
For now however, the buyers remain in control, with a wary eye on the potential for a more corrective/consolidation phase.
On Friday, the Canadian employment statistics came out weaker than expectations, but so was the US employment data. The price on Friday moved up to test its 200 hour moving average (green line in the hourly chart above) but backed off against the technical level. The break above the level today was significant as result.