Seller Interest Building on the USDCAD?
1.3618 resistance continues to hold back buyers.
Sellers have started to make their move in today’s London session after a resisting a strong move on risk FX and Oil yesterday. This was slightly surprising this morning as with some of the gains seen from risk to the USD. Oil was another mover overnight so both sides of the USDCAD went down but buyers held onto small gains after fade in the NY session.
Looking at the current daily chart we can see that price remains range-bound with very little to no momentum on the moving averages. Price set a new LH yesterday and with current resistance holding buyers back we are looking for momentum to move further with sellers. If they can remain in control we would be looking for a new test of the range base, 1.3505 – 1.3500. Range support has been standing since June, so for sellers to get the downtrend going again they would need to break through that area.
On the other side, if buyers form a new higher low at or above range support, this could be a warning that seller strength might not be that prevalent and the current range could continue. A break and close above 1.3618 could start to shift the balance to the buyer side. A lot may come down to several new sessions in order to start seeing a clearer picture around who could be holding momentum.
Finally, oil could play a role, if price can break out and close above $41 this could give the CAD the boost it needs to settle in upward momentum.
Upcoming USD sensitive news, 7:00 am AEST President Trump Speaks
USDCAD D1 Chart