USD/CAD has climbed to 1.4080 today, a gain of approximately 320 pips since a September 8 low near 1.3760, as buyers test a key resistance level. A confirmed break higher would open the door toward 1.4129-1.4148 and eventually the June high at 1.42474, while a slip back below 1.40503 would start to chip away at the bullish case.
USD/CAD buyers pushed the pair to a high of 1.4080 today, extending a three-week advance from a low near 1.3760 on September 8. That move has added approximately 320 pips over 11 trading days.
The rally has cleared a series of technical moving average barriers along the way. Buyers broke the 200-day moving average near 1.38377 on September 11, then cleared the 100-day moving average at 1.3952 on September 16. The pair then pushed above the 50% retracement of the decline from the June 24 high to the August 21 low, at 1.39894, before extending above the 61.8% retracement at 1.40503 today.
Buyers test resistance at 1.4080
The pair is now testing the 1.4080 area, which matches swing highs from August 4 and August 5. A sustained break above that level would shift the focus toward a swing area between 1.4129 and 1.4148, and a move through that zone would put the June high at 1.42474 in view. Buyers remain in control, but they still need to prove they can hold above 1.4080.
What could weaken the bullish case
With price above the 61.8% retracement, the 1.40503 level now marks the closest risk-defining line for buyers. A move back below it could prompt traders to question the breakout, though the more important support sits near the 50% retracement at 1.39894, reinforced by a swing area extending toward approximately 1.4003.
A deeper break below that zone would open downside targets at the 100-day moving average near 1.3952, the broken 38.2% retracement at 1.39285, and the converged 100- and 200-bar moving averages just below 1.3900 on the four-hour chart. A drop through those averages would tilt the short-term bias more firmly toward sellers.
Source: Investinglive.com
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