The USDCAD spent yesterday capped by a confluence of resistance—its 100-day moving average at 1.37738 and the 100-bar moving average on the 4-hour chart (blue line) at 1.37516. In early trading today, sellers again leaned on the lower 4-hour average, but buyers stepped in, pushing the pair higher (see lower blue line on the chart above).
Stronger-than-expected PPI data fueled a breakout above the 100-day moving average, triggering a run that took price beyond this week’s prior high at 1.3805. The rally has since extended to 1.3817.
Going forward, the 100-day moving average now serves as a key risk level for buyers seeking additional upside momentum. A sustained move back below would undermine the bullish bias. On the topside, the next resistance target comes at 1.3860 (the May 29 high), followed by 1.38789, the high from two weeks ago.
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Get above that level and traders will start focus on stretching toward the 38.2% retracement up at 1.39229. If the buyers are two take back more control. Absent that and the market is still within a sideways up and down range.
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