Forex technical analysis: USDCAD moves above 100 day MA
On the day oil is moving higher (after two days of strong selling), the CAD gets weaker.
Crude oil futures tumbled on Monday and Tuesday and the USDCAD did little. Today crude oil is moving higher (+$0.70 or 1.35%) and the CAD is getting weaker.
Now last week the employment report out of Canada was much stronger than expectations. So perhaps the CAD was supported by that fundamental reason.
The move higher today, seems to be more USD following. The EURUSD is trading at the lows. The USDCHF is taking off. The NZDUSD is back trading at the lows after moving higher and the USDJPY is trading at highs.
For this pair we just moved back above the 100 day MA at 1.32587. We trade at 1.3366 currently.
Looking at the hourly chart above, the price is also now moving above trend line resistance and away from the 100 hour MA (blue smooth line at 1.32354 currently). The high from Monday at 1.3276 is the next target followed by the high form Jan 5 at 1.33129. The 200 hour MA at 1.33255 is another target.
The price of this pair has traded above the 100 day MA after breaking below on Friday of last week, and on Monday. Yesterday the 100 day MA stalled the rallly. The move above is the 3rd time. The price has to stay above now (that is risk for longs now).
Do you sell rallies? Is this just a correction?
The move lower from the end of December high took the price from 1.3598 to 1.3176 in 7 trading days (6 straight down days in the process). Sellers were anxious to sell, sell, sell. So the buyers have to prove they can keep control. On the bullish side, is the 100 day MA was broken an the next key target at the trend line could not be reached on the daily chart. Also on the daily chart is that the lows since the May 2016 low are all higher.
DOE oil inventories are to be released at 10:30 AM ET.