Are we about to see some 4th of July fireworks from this dollar pair soon?
Check out the USD/CAD levels I’m watching.
As you can see from the 4-hour chart below, the pair has recently fallen below the floor around 1.3350, a minor psychological mark.
The price is now in correction mode after rising from 1.3120 lows and may find more sellers in this area of interest.
Forex USD/CAD for 4 hours Planned by TV
Using a handy Fibonacci retracement tool on the recent bearish swing shows that the 38.2% level is near the previous support.
A larger pullback could reach the 50% level which coincides with the dynamic inflection point of the 200 SMA.
The 100 SMA is below the slower moving SMA, indicating that the resistance levels are more likely to hold than to break. Also, the gap between the indices is widening to reflect the increase in selling pressure.
In this case, the USD/CAD pair may drop to lows soon. The 100 SMA seems to be holding as dynamic resistance at the moment!
At the same time, the stochastic is moving lower to confirm that the bearish momentum is coming into play. The oscillator has a lot of ground to cover before reaching the oversold area to indicate that the sellers are tired.
Of course a bunch of high-level catalysts out of the United States and Canada are worth watching when trading this week. Did I mention that we have jobs reports from both economies, as well as the FOMC meeting minutes?
