The USDCAD continued its downward pressure earlier today, breaking below a key swing area between 1.38078 and 1.38499. This zone has been significant, acting as support and resistance going back to October–November 2024, and again over the past two weeks.
The break took the pair to a new low at 1.37808, marking the lowest level since October 17, 2024. However, that downside extension ran out of steam, and the pair has since rebounded, climbing back into the swing zone.
The near-term battle now centers on whether buyers can push the price above the upper boundary of the swing area at 1.38499. A move above that level would represent a small victory for buyers, but additional hurdles lie ahead.
The next upside targets that would ultimately need to be broken would include the:
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100-hour moving average at 1.38692 (see blue line on the chart below) – A break above would add to short-term bullish momentum.
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200-hour moving average at 1.39122 (green line on the chart below)– Clearing this level would be a more convincing shift in bias toward the upside.
As it stands, the bias remains tilted toward the downside, but buyers are trying to make a stand. Watch 1.38499 closely—stay below, and sellers remain in control; break above, and the recovery effort gains traction.
This article was written by Greg Michalowski at www.forexlive.com.