The USDCAD is currently experiencing volatility, influenced by the rising oil prices following the OPEC decision. Despite a recent technical break below its 100-day moving average near 1.3560, traders remain cautious. This caution stems from an earlier instance this week where the price similarly broke below the 100-day average but failed to sustain the downward movement. Presently, the price has rebounded above the 100-day average and is approaching the 38.2% Fibonacci retracement level of the upward movement from the July low to the late October high, located at 1.35902.
If this retracement level fails to act as resistance, it might signal a weakening of the selling pressure. Sellers had an opportunity earlier this week below the 100-day average and are attempting again today, but it remains to be seen if they can maintain this momentum. Should the price continue to fall below the 100-day average, the next targets could be the 200-day moving average at 1.3517 and the 50% Fibonacci retracement of the July to October rise at 1.3495. On the flip side, if the price breaks above the 38.2% retracement at 1.35902, it would be unexpected for it to surpass earlier daily highs of 1.35248.
This article was written by Greg Michalowski at www.forexlive.com. Source