- The USD / CAD fell more than 100 pips from the two-week highs set earlier on Thursday.
- The implementation deserves some caution before placing aggressive directional bets.
The USD / CAD pair reversed and fell more than 100 pips from the two week highs around the 1.4175 region established earlier on Thursday. A sharp rise in oil prices boosted the commodity loonie and brought the pair below the 100-hour SMA for the first since May 1.
Meanwhile, the technical indicators on the 1-hour chart drifted lower in the bearish territory and lost momentum on the 4-hour chart. However, the oscillators of the daily chart have managed to maintain a slight positive bias and deserve some caution before placing new bearish bets.
However, the pair still looks vulnerable to further slide towards a difficult 200 hour SMA. This is closely followed by the key psychological mark of 1.40, which should now act as a key pivot point and help traders determine the next step in a pair’s directional movement.
On the other hand, any attempt at recovery could now face a new offer near the 1.4100 bar. A lasting breakthrough across the mentioned barrier, leading to further movement beyond the 1.4120 region could negate any short-term bearish outlook and spur new purchases.
The pair could then further accelerate the positive movement towards the recovery of the 1.4200 round mark brand before the bulls finally aim to overcome the next major obstacle near the 1.4235-40 supply area.
1 hour USD / CAD chart