USDCAD is testing a significant resistance level today.
You can see how it has served as a pivot of sorts since the November 20, 2018 high.
The 1.3320 area is also very near the 38.2% Fibonacci of the range that extends from the October 2018 low to the December high.
All of this follows the breakdown I mentioned on January 3rd.
The larger channel I pointed out in that commentary suggests we could see USDCAD continue lower.
First up is the 1.3060 horizontal support level. It was a key factor since June of last year.
In my opinion, this is where USDCAD is likely headed next.
But it all depends on whether or not the 1.3320 resistance area can hold on a daily closing basis.
Keep in mind that I use New York close charts so that each 24-hour session closes at 5 pm EST.
Go here to get access to the same charts I use for trading price action.
If it doesn’t hold, we could see USDCAD extend higher toward former channel support (new resistance) just above the 1.3400 handle.
Given the recent sideways price action, it would make sense to wait for a bearish signal of some sort.
It could be a pin bar or perhaps an eventual engulfing candle.
Regardless, USDCAD is vulnerable while below the 1.3320 level.