Forex Trading, News, Systems and More

USDCAD moves below 100/200 hour MAs as risk on flows dominate early NA trading | Forexlive

The “risk on” sentiment is helping to push the USDCAD lower in early North American trading.

Helping are soaring stocks. The major US indices have now erased their Friday declines. The Dow industrial average moved up around 600 points at its highs. The NASDAQ index is up over 3%.

Looking at the USDCAD , the pair in the London morning session tested 100 hour moving average at 1.3803. After a corrective move higher took the price back toward resistance near 1.3875 (see solid red line on the chart above)), the sellers reentered and have been able to extend the price back below the 100 hour moving average at 1.3800 (and the 38.2% retracement of the move up from the October low at 1.37957 currently).

The price has since moved below the 200 hour moving average at 1.37539 and looked toward the swing lows from last week near 1.3701. The low price just reached 1.37135 and bounced back toward 1.3738 currently.

What next?

With the price moving below the the hourly moving averages, sellers will now be looking to lean against those levels with close risk now being the 200 hour moving average 1.37539. Stay below that moving average keeps the sellers more in control. A move above would be disappointing.

In addition to the support at 1.3701, the 61.8% retracement of the October trading range at 1.36836 followed by a swing area between 1.3637 and 1.3666 would be the next downside targets.