Topside trend line targeted at 1.3108
The price of the USDCAD has made a huge recovery after yesterday’s fall after the BOC tightened with more hawkish overtones (taking out the word “gradual” from the statement).
The rally today – after an earlier dip into the London morning session – has seen the price squeeze above its 200 hour moving average at 1.30415 (green line in the chart above), the 100 day moving average (after testing it first) at 1.30683, and is most recently moving away from its 100 hour moving average at 1.30792.
The high from yesterday reach 1.3100. The high today has so far reach 1.3098. So there is some “tire” at the prior day high (the lap is almost complete). Above that level is a trend line at 1.3108 which should also give traders some cause for pause after the run back higher.
Risk for longs can be eyed at the 100 hour MA or more importantly, the 100 day MA. Move back below the 100 day MA, and I would expect the bulls to lose some of their enthusiasm.