The USDCAD raced higher with the USD buying earlier today, but has rotated back to the downside in the North American morning session.
The Bank of Canada will meet on Wednesday and are expected to raise rates by 50 basis points to 2.0% from 1.5%. On Friday, the Canadian jobs report came in weaker than expected. However the bank is more focused on inflation and getting rates more toward neutral levels.
. Looking at the hourly chart, the move to the upside today traded above and below its 100 hour hour moving average in the early European session, but raced higher at the start of the North American session. The high price stalled at 1.3051 short of the high price from Thursday’s trade at 1.30548. The high prices from last week reached up to 1.30826.
The subsequent move to the downside over the last couple hours has seen the price move back below the aforementioned 100 hour moving average 1.30056 and also now below the 1.3000 natural support level. The price low just reached 1.29817 which is the 38.2% retracement of the move up from the June 28 low.. There has been some resistance and support against that level in trading today.
A move below would open the door for further downside momentum with the 50% of the same move at 1.29506 and the rising 200 hour moving average (green line in the chart above) at 1.29457. On Friday and again today, the price based at that 200 hour moving average, increasing levels of importance going forward. Be aware.