The USDCAD spike higher, and in the process moved up to retest it at 200-hour moving average at 1.31917. Sellers leaned against that upper moving average level (green line in the chart below), and corrected the price modestly to the downside. If the buyers are to remain in control, getting back above both the 100 (blue line in the chart below), and the 200-hour moving average (green line).
On a break above, the 38.2% retracement of the move down from the July high to the July low comes in at 1.3204. Above that, and traders will start to look toward the high price from Tuesday and the 50% midpoint near 1.3240.
Close wrist now would be a move below the Monday low at 1.3159.
With the spike higher in the USDCAD, the buyers are making a play. Can they complete the run with a break above the 200-hour moving average and the 38.2% retracement.
This article was written by Greg Michalowski at www.forexlive.com. Source