The USDCAD moved up to retest Wednesday’s high in trading today at the 1.3603 level and found willing sellers. The relatively random level (although it’s around the round number 1.3600), will be a barometer for further bullish bias on a break today. If done, traders will look toward another swing area near 1.36534 which comes ahead of the extreme from April at 1.36673. A more hawkish Fed chair speech would have traders retesting those levels.
Conversely, if the Fed Chair is less hawkish, moving below a swing area between 1.3564 and 1.3585, would open the door for further selling toward the 38.2% retracement of the move up from the August 10 low. That level comes at 1.35145, and most recent lows this week bottom near that area. Below that and traders will target a swing area near 1.34965.
The buyers are more in control ahead of the chair speech, as the bias from traders is still for a higher dollar (at least now).
This article was written by Greg Michalowski at www.forexlive.com. Source