Canadian Greenback, USD/CAD Speaking Factors:
- USD/CAD set a contemporary September excessive on Monday and yesterday costs snapped again to a key assist zone greater than 200 pips away.
- Costs in USD/CAD at the moment are sitting on the identical 1.2631 stage that held the lows final Friday.
- The evaluation contained in article depends on price action and chart formations. To be taught extra about value motion or chart patterns, take a look at our DailyFX Education part.
Earlier in the week USD/CAD brought the excitement when the pair ran as much as a contemporary September excessive, threatening a take a look at of the prior 2021 excessive at 1.2950 and probably even a re-test of the 1.3000 psychological stage. That breakout had already begun to pullback by mid-day on Monday, and costs have pushed by means of each of the higher-low helps that I had checked out beforehand. Now, we’re on the final cease of assist that I had checked out and it’s an enormous one as this is similar value that’s been in-play since January.
The costs in query are at 1.2621 and 1.2631; the latter of which is the 23.6% Fibonacci retracement of the 2020-2021 sell-off whereas the previous is the 50% marker of the longer-term 2002-2007 main transfer. Collectively, these costs create a confluent zone that’s been very energetic over the previous month as each assist and resistance.
USD/CAD 4-Hour Value Chart
USD/CAD Larger Image
This latest transfer in USD/CAD mirrors that of the US Dollar pretty properly, the place an early-week spike dissipated with a hastening within the transfer round FOMC. However, value motion is value motion and at this level there are however a few choices for merchants trying to construct technique round USD/CAD.
Given the push right down to assist mixed with a present from patrons, vary situations stay doable, in search of a push again in direction of 1.2700 or even perhaps 1.2750.
On the bearish facet of the pair, there may be breakdown potential given the re-test of this well-trafficked assist zone. The 1.2500 psychological stage stays of curiosity beneath value motion and that value helps to mark the present month-to-month and September low within the pair. There’s additionally a value motion swing round 1.2578 that might be used as a extra close by space of assist earlier than that 1.2500 stage may come again into play.
USD/CAD Hourly Value Chart
Chart ready by James Stanley; USDCAD on Tradingview
— Written by James Stanley, SeniorStrategist for DailyFX.com
Contact and observe James on Twitter: @JStanleyFX