The USDCAD is trading to a new session low and in the process is testing a key floor that has been developed over the last seven or so trading days. That floor comes in around the 1.35478 level. A move below that level is needed to increase the bearish bias. If broken, traders would next target the 200-day moving average at 1.35134. Moving below that level, and traders will look toward the lows from December at 1.3479.
If support does hold at the floor of 1.35478, a move back above the 200-hour moving average at 1.3569 would have traders looking toward the 100-hour moving average at 1.35839, followed by the 100-day moving average of 1.35936. Breaking back above those moving averages would next have traders targeting the 38.2% retracement 1.36224. That level tops a swing area between 1.3613 and 1.36224 and would need to be broken to give the buyers more control and show that they are serious about pushing the price to the upside.
The levels are defined. Traders wait for the next break.
This article was written by Greg Michalowski at www.forexlive.com. Source