USDCAD retreats as dollar selling strengthens, technicals indicate bearish momentum

The USDCAD currency pair is experiencing a decline, reaching new lows in today’s trading session, influenced by a broad sell-off in the US dollar across the Forex market. Currently, the pair is moving away from the 38.2% Fibonacci retracement level of the upward trend that began in July 2023, a significant level located at 1.35902. This level is now acting as a pivotal point for short-term risk assessment.

The ability of the USDCAD to stay below this 38.2% retracement is a critical indicator that sellers are gaining momentum and potentially taking control of the market direction. This makes the 38.2% level a key determinant for future market bias and risk evaluation.

Additionally, traders are closely watching another crucial technical level – the 100-day moving average, which stands at 1.35507. Breaking this level could further strengthen the bearish outlook for the pair. As of now, the lowest price reached today is 1.3563, indicating that sellers are actively pushing the pair below the 38.2% retracement mark. The key question for market participants is whether this selling pressure can be sustained and lead to a breach of the 100-day moving average, thereby confirming a stronger bearish trend in the USDCAD.

This article was written by Greg Michalowski at www.forexlive.com.