The USD/CAD has declined in today’s trading, breaking below the lower boundary of the swing area between 1.4334 and 1.4348. For a bullish bias to emerge, the pair would need to climb back above this zone, signaling a potential failure of the break outside the “Red Box” that has defined recent trading ranges over the past few weeks.
As long as the price remains below 1.4334–1.4348, sellers retain control, with the next downside targets at 1.4260–1.4270.
On the flip side, if the price re-enters the “Red Box” by moving above 1.4348, the converging 100-hour and 200-hour moving averages at 1.4383 become the next key resistance level. A break above these moving averages would shift the focus to the upper half of the “Red Box,” paving the way for a potential retest of recent highs.
For now, the sellers are trying to keep control. Can they keep that control?
This article was written by Greg Michalowski at www.forexlive.com. Source