TODAY USDCAD ANALYSIS : USDCAD moves to new lows after higher CPI inflation


TODAY USDCAD ANALYSIS : The pair has been trending lower today after breaking 100/200 hour MA again

TODAY USDCAD ANALYSIS : The  USDCAD  has moved to a new low after the higher-than-expected CPI data. The price moved below the low from April 14 at 1.2520 reaching 1.25142. That is short of the next target at the 61.8% retracement of the move up from the April 5 low. The retracement level comes in at 1.25065.

The price action today is already seen a sharp move to the downside on the US dollar weakness.

Technically, the Asian session high price stalled against its 100 day moving average at 1.26245, and then moved back below the 100/200 hour moving averages near 1.2604 (they were near converged).

A swing area near the 1.2571 level (it was also the 38.2% retracement), was broken as well. That area is the low of what was a value area (area where most of the price action has traded since April 7). The high of the value area stalled the rally yesterday near 1.2645 (see red box in the chart above).

The price action since April 7 has seen moves above and below that value area, but most of the price action has been within the red box (see hourly chart above).The breakout of the red box today lead to more selling as traders shifted the bias to the downside.

What now?

TODAY USDCAD ANALYSIS : Watch the 50% midpoint of the same trading range at 1.25387. Stay below that level would keep the sellers firmly in control. Another level would be near the swing low from April 11 at 1.2550.

 What traders will not want to see is a move back above the 1.2571 level.

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