USDCAD hanging above and below the 1.3500 level | Forexlive

The USDCAD has spent most of the trading time between 1.3500 and 1.3854 since September 22 (33 trading days). Admittedly, there was a break higher and above the top extreme area (between 1.3807 and 1.38548) on two seperate occassion in October. Both were short lived break (see red shaded areas). Last Thurday, the high extended to the low of the upper swing area at 1.38072. The high reached 1.38074 and backed off .

ON Friday, the selling intensified below the 100 and 200 hour MAs (blue and green lines mid range) and the selling took the price back below the 1.3500 level and closed below that key area. A much stronger Canada jobs report and a softer overall dollar gave sellers an added shove to the downside.

However, in trading today, the price rebounded back above the key lower extreme area – reaching an intraday high at 1.3552 – before rotating back to the downside once again (below 1.3500 to 1.3510) and to a new low low going back to September 22 at 1.3464.

Keeping the volatility going, the pair moved back above 1.3500-10 area but is now trading just below.

The USDCAD pair has the ups and downs. Moreover those ups and downs are above and below the key 1.3500-1.3510 area.

Typically, a break is a break. The price should go lower.

When it does not and instead waffles above and below the key target area, it says the market is unsure. That is frustrating – I know – but the market nearly did the entire 33 day range in two days (over 300 pips). You can argue, that type of move to key support area deserves a breather.

The question now is “Which way does the pair break?”

Overall, the sellers are still more in control. The burden is on the buyers to show they can do more.

Looking at the 5-minute chart below, the last trend move down on Friday corrrected into the 38.2-50% of that last leg down. If the buyers are to take more control, getting above the 50% at 1.35612 is the minimum target to get to and through.

Looking closer, the 200 bar MA at 1.35056 and the 1.3528 are closer targets (see 5 minute chart below).

Absent moves like that, the sellers are still in firm control.