Forex

USDCAD continues its move to the downside. Reaches the next key downside target.

The USDCAD has fallen to the subsequent draw back goal

In an earlier post, the  USDCAD  that fallen to a brand new session low after the higher-than-expected CPI information. The low value prolonged beneath the low from April 14 at 1.25200, however noticed a bounce again towards the 50% retracement degree.

Within the earlier post I commented:

“Watch the 50% midpoint (of the identical buying and selling vary) at 1.25387. Keep beneath that degree would hold the sellers firmly in management.”

That fifty% retracement degree did maintain resistance on the corrective transfer larger, and the value began to maneuver again to the draw back as sellers have been inspired and patrons turned more and more nervous.

Additional in the post I commented:

“A transfer beneath the 61.8% retracement at 1.25065 would have merchants concentrating on 1.2479 space. A swing low from April 6 got here in close to that degree. There additionally different lows from April 1, and April 4 round that degree.”

The value low has since reached 1.24807 (see purple numbered circles within the chart above). There was a modest bounce as much as a 1.2495.

What now ?

Just like the 50% retracement, the 61.8% retracement 1.25065 will now be eyed as resistance. Keep beneath and the sellers stay in agency management. A transfer beneath 1.24798 would have merchants concentrating on 1.2463.

What could give merchants some trigger for pause, is on the present assist the buying and selling vary for the day is now as much as 143 pips. The typical over the past 22 buying and selling days (across the month of buying and selling) is 80 pips. So at 143 pips that’s 179% of what’s regular. The market could take a breather towards the assist degree, with stops on a break beneath.

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