USDCAD corrects 38.2% of the move up from last week's low

The USDCAD moved lower into the NY open, but the price rebounded higher after the higher CPI data.

However, the high price of the  USDCAD  stalled near earlier swing highs from yesterday and a late day swing high as well near 1.3038. Of note is those highs bookended a move up to 1.30515. That break to the high yesterday failed, and as often happens, the market reestablished resistance at a lower level (i.e. the 1.3038 level).

Today's run higher kept the lower level as the ceiling. The high price today reached 1.30387 and stalled. The price has since moved lower on the USDs rotation back to the downside.

The fall lower in the USDCAD has now seen the price move down toward the rising 100 hour MA at 1.29377, and below that the 38.2% of the move up from last week's low. That retracement level for the USDCAD comes in at 1.29221. The low price off the fall stalled right near that 1.2922 (low reached 1.29202). The price has bounced modestly.

What now?

The lower highs against 1.3038 formed a ceiling for the pair and gives sellers some hope that a corrective move to the downside has started (i.e, the high is in place at least for now).

However, the holding of the 38.2% at 1.2922, and the price action above and below the 100 hour MA has traders thinking that those levels still need to be broken if the sellers are to take more control.

Dip buyers currently are likely using the levels as a low risk buying opportunity (at least in the short term) with hopes for a move back above 1.2950 area as a comfort move in the short term. I would expect, however, that those dip buyers would exit with a move below 1.2920-22 area now.

On a break lower, the 200 hour MA at 1.2882 (it is also the 50% midpoint of the same move higher) would be another downside target to get to and through if the sellers are to take back more control.