The USDCAD moved lower ahead of the Bank of Canada rate decision, trading at 1.3907 just before the announcement. Following the release, the pair briefly dipped to a session low of 1.3900 before rebounding.
From a technical perspective, the pair is now back below the 100-hour moving average at 1.3930. Earlier in the session, price action oscillated around that level, with the softer reaction to the U.S. CPI report helping to push the pair lower. The 100-hour moving average acted as support on June 5 and again yesterday, so a sustained move below the level shifts the bias modestly in favor of the sellers.
What sellers have not been able to do, however, is force a break below the 200-hour moving average at 1.3886. That key support level attracted buyers on June 2 and again on June 1, reinforcing its importance. A move below the 200-hour moving average would strengthen the bearish case and open the door toward the next downside target at 1.3868, the lower boundary of a key swing area.
For now, with the pair trading between the 100- and 200-hour moving averages, sellers have gained some control, but they still need a break below the 200-hour moving average to increase downside momentum.
This article was written by Greg Michalowski at investinglive.com.
