USD/CAD’s Test of Resistance Offers Scalping Opportunity
Key Technical Levels
The 20-Day SMA currently at 1.0267 could be a formidable barrier as price action has remained below the technical level since February 26th. A short-term rising trend line and a smaller than expected build in U.S. oil inventories could continue to provide support, minimizing downside risks.
The Bollinger band width for the USD/CAD has begun to narrow as the prior bearish one-way price action has ended. However, at 551 pips it remains one of the largest spreads of the most active pairs and a potential red flag for high frequency traders. Despite the pairs nearly 500 pips decline daily volatility was fairly subdued which has push the ATR down to 88 pips and accounting for only 0.95% of the spot price adds to its attractiveness as a scalping target.
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