1.3208-11 was a swing level on 4-hour going back to January
If you to back to Jan 24, Feb 7th and Feb 22nd, the USDCAD had swing levels at the 1.3208-11 area. On February 28th, the price moved back above that level and moved higher.
On April 13th, the price came back down to the level but stalled ahead of the swing level. The low reached 1.3223.
Fast forward to today and the low just reached 1.32107. The price bounced. The level is now a stronger risk defining level. Stay above and better corrective potential. Move below and there should be more selling.
Looking at the 5 minute chart, the largest price correction since the comments from BOC Wilkins yesterday, saw the price move above the 100 bar MA (blue line in the chart below), but then stall against the 200 bar MA (green line). The buyers tried, but they failed to take the correction to the next level. The fall back below the 100 bar MA accelerated the fall.
The current 100 bar MA comes in at 1.3246. The 200 bar MA comes in at 1.32634. Both are moving lower. If the price moves above each, the dip buyers - against the 1.3208-11 risk area - are feeling more confident that a bottom is in place.
It does not guarantee a full fledged retracement - there are other levels to take back including the 1.3277 (50%), 1.3292 (61.8%) and then the key 200 day MA at 1.3328 (tough nut to crack)- but dip buyers would be happy....and the risk was limited.
