As the price of oil moves higher, the price of the USDCAD is moving lower (higher CAD). Crude oil is trading at $86..46. That is up 3.41%. The low price on September 26 reached $76.23. The high price today reached $86.95. That is a move of 14% or $10.72 from the low to high.
OPEC will be meeting tomorrow with chatter of a cut in production of 1 – 2 million barrels per day to counteract the demand destruction.
Looking at the hourly chart of the USDCAD, the pair move down in the Asian session only to rebound into the North American open. At the session highs, the pair tested its 200 hour moving average at 1.3658 and also a swing area between 1.3637 and 1.3666. The high price reached 1.36637 before rotating back to the downside of the last 3-4 hours.
The low has just reached 1.35524. That takes the price into a consolidation swing area from the trend move to the upside between 1.3543 and 1.3557. A move below that level will have traders targeting the 38.2% retracement of the move up from the September low to the end of September high. That level comes in at 1.34992 (call it 1.3500).
What is a risk level now?
The earlier session low near 1.3567 to 1.3570 is close risk. Alternatively, the swing low from September 29 at 1.3597 (call it 1.3600) is a more conservative stop level if you think the break below the hourly moving averages should give sellers more ammunition to the downside.
