The USDCAD had lower lows for 10 consecutive days that took the pair to a cycle low at 1.25166 on Wednesday. Yesterday the BOC warned about the housing market which got the ball rolling back to the downside for the loonie (to the upside for the USDCAD). The price shot higher reaching to the 100 day MA at 1.2702 area.
Today there was a dip in the early Asian session, but moved back above the 100 day MA and buyers returned.
Although Canada jobs data was strong, the US CPI trumped that number, and the dip was bought sending the pair to and through the 50% of the move down in May at 1.27963. The high price reached 1.28119.
Looking at the hourly chart, the price also moved back into the red box that confined the pair from mid-May to May 27. Watch the 1.2775 level for close support. Stay above would be more bullish and have traders looking toward the upper levels in that old “red box”.
On a move back outside of the red box, a rotation back toward the 38.2% at 1.27303 would be eyed.