USDCAD finds sellers against the highs for the week

The Bank of Canada cut rates by 50 basis points yesterday and the initial reaction was lower (higher CAD).

However, after falling below a target at 1.4145, and the rising 100-hour MA, the price snapped back higher. In trading today, the initial reaction was to the downside before rebounding back to the upside in the early North American session.

Today’s high price extended back to the highs from the last two trading days near 1.41942 and for the third day in a row found resistance sellers leaning against the level. The high price today reached 1.41946 just above the high price from Tuesday’s trade. Yesterday the high price stalled at 1.41929. The area has become a solid ceiling (PS and the higherst level going back to 2020).

With the ceiling firmly in place, breaking the ceiling is needed to increase the bullish bias today and going forward. Sellers may continue to lean, there is work to do to the downside to give them more confidence.

• Getting below the rising 100 hour moving average of 1.41563 and staying below
• breaking below the 1.4145 level and staying below.
• Reaching and breaching the swing area between 1.40889 and 1.41045. The rising 200 hour moving average comes in at 1.41039.

Admittedly, the price action in the pair is sporadic. The highs are somewhat random but traders have created a solid ceiling nevertheless at the level.

The moves lower have tried to make breaks, but they have failed.

Overall, the buyers remain in control. The seller have tried but they need to do more to wrestle the control from what is 4 year highs in the currency pair.

This article was written by Greg Michalowski at www.forexlive.com.