USDCAD is moving towards the major swing zone
USDCAD is breaking higher off 50% of the move down from the March high to April low. The bottom came at 1.35808. Today’s low is at 1.3585. Yesterday, the price broke above the 50% retracement level and also held against the 50% level (at 1.3583). rising.
Looking at the 4-hour chart above, the move higher is now approaching the 61.8% retracement of the same move lower (from the March high). This level comes at 1.36472. Just above there is a swing zone between 1.36504 to 1.36674. This area was the February ceiling and floor (yellow area and red numbered circle). In April, the price returned to that area and found sellers willing to test. A subsequent sell-off sent the price down towards the April low of 1.33137 on May 8, before starting to turn bullish again.
This area is a prime target. Today’s high reached 1.3644, and sellers headed in initially. However, it may take a move back below the 50% retracement level to damage the bearish bias in the medium term.
Traders looking for a nearby risk level will watch 1.3613-18 as the nearest support. This area is defined by the swing highs from earlier in the day and the swing lows from the recent price action (see 5-minute chart below) The current price is trading at 1.3637.
Definition of risk close to USDCAD