The USDCAD moved higher in early North American trading today, and in the process the price moved up to test it’s 200 hour moving average . The 200 hour moving average (green line in the chart above) comes in a 1.33477. The high price reached 1.33469, stalled, and rotated back to the downside.
At the high, the price was also testing a swing area where there had been a number of swing lows going back to January 9. That swing area comes between 1.3339 and 1.3358 (see red circles).
Admittedly toward the end of January – and into early February – the price of the USDCAD has been trading more frequently above and below the swing area as the market swung between more bullish and more bearish daily.
However today’s high not only stalled against the 200 hour moving average, but also in the middle of the aforementioned swing area. Sellers put a lid on the rally.
Going forward traders will continue to use that moving average and swing area as an upside ceiling. Stay below and the sellers remain in firm control. It would take a move above to increase bullish bias.
Taking a broader look at the daily chart below, on more downside momentum, traders will be eyeing the 1.3207 – 1.32299 area. That area is home to swing highs going back to July 2022, and swing highs going back to September of the same year.
The price then rotated above that area in September, and did not return again until November where support buyers once again leaned against the area. That swing area is now joined by the rising 200 day moving average (green line in the chart below). That moving average currently comes in at 1.32127. Having the swing area and the 200 day moving average at the same area increases the areas importance.
Just below that area is also the 50% midpoint of the range since the 2022 low at 1.31895. So on further selling going forward, there is a lot of support between 1.31895 and 1.32299.
Be aware. Key support on the downside.