Runs back above the 200 and 100 hour MAs
The USDCAD has also seen dollar buying today.
The pair in the Asian session tested a lower upside sloping trendline. The second dip today found early support buyers against the trendline. That was a more bullish clue but the better data today was needed to push higher.
Retail sales and Philly Fed index was much better than expected and the dollars started to move higher. For the USDCAD, it helped to push the price through the 100 hour moving average (blue one currently at 1.26587 – earlier the 200 hour moving average was broken at 1.26424).
The price ran up to a swing area between 1.26938 and 1.27078 (the high price reached 1.2695). The price is seeing some stall in that area now. If the price can move above the 1.27078 level, it will have the 50% retracement of the range since the August 20 at 1.27204 is the next upside target. Earlier this month, the price did extend above that level on both September 8 and September 9. However each break was relatively short-lived.
On a new break, the price would need to stay above that level to give the buyers the added confidence to push higher. Most of the price action since August 23 has been below 1.27078 (only six hourly bars has traded above that level).
PS. A headwind to the upside may be the price of crude oil. Today, the price is lower by about $0.70. However, the price has been stepping higher as increased demand and low supply continued to push up prices. Higher oil prices tend to help the CAD in general. Nevertheless pay attention to the price action in the technicals for the bias clues. If the price is able to trade above 1.27078 and extend above the 50%, the technicals would increase the bullish bias (negative for the CAD).