Technically, the pair breaks the 100 hour MA for real this time...
The USDCAD is trading near high levels for the day and in the process is moving further away from its 100 hour MA. The pair - coming into today - only had one hourly close above that MA since June 9th. That was yesterday when the price moved above the MA on two separate occasions with each failing (and only one close above).
Today after consolidation in the Asian and early London session, the price got a push higher that took the price through the 100 hour MA again (at 1.3235 - the MA is currently at 1.32379). It also broke above a trend line at the same area. This time, the pair did not hesitate. The pair has moved to a high of 1.3283.
Sharply lower oil prices (see Adam's post here) has contributed to the rise of the USDCAD (and fall of the CAD). Crude oil has traded as low as $42.83. The futures contract currently trades at $42.94.
There is strong overhead resistance at the 38.2% and 200 hour MA in the 1.33059-118 area. The high from Friday at 1.33075 is also a target in that area. IF tested, you kinda have to expect some sellers against the area.
The USDCAD has been more on a downside path since BOC's Wilkins and Poloz spoke hawkishly about rates last week. The pair has been ignoring the weakness in the price of crude that tends to weaken the CAD. Today's near 3% fall in the price has gotten traders attention, however, and combined with a technical break, has buyers taking more of control (at least for now). The overhead resistance looms though.
What would turn the beat back to the downside?
Moving back below the 100 hour MA would certainly not be good. Closer in, watch the 1.3252 level. That is the 38.2% of the days trading range and near the highs from a swing high from yesterday's trading (see red circles on the chart below).
