USDCAD failed to break above the key 1.4700 level after coming close to it in January to hit 1.4689 – a more-than 12-year high. Consequently prices fell since then to reach the 50% Fibonacci level of the upleg from 1.2831 to 1.4689 (October 2015 to January 2016 rise). Prices are now testing this level at 1.3760.
Immediate support is being provided by the 100-day moving average around 1.3673. If the market makes a sustained advance higher above the 50-day moving average then it could aim for 1.4000.
Alternatively, should the market resume its decline back below the 50% Fibonacci and below the 100-day moving average, then the 61.8 Fibonacci comes into view at 1.3540. For now the momentum indicators are favouring the downside bias, as MACD is below zero and RSI is below 50. But with the moving averages flattening out to become horizontal, this indicates a neutral bias in the immediate term.
Risk Warning: Forex, Commodities, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you fully understand the risks involved and do not invest money you cannot afford to lose. Please refer to our full Risk Disclosure.