OIl below $39 (-1.27%) starting to help the pair recover

The USDCAD moved lower in sympathy with the dollar weakness today. This while oil prices moved lower as well. The price of oil has moved below $39 (down -1.27%) and the price of the USDCAD is starting to react with a move back to the upside.

Helping from a technical perspective is a move back above the the 100 hour MA (blue line in the chart above) which comes in at the 1.3195 level. The low extended to 1.3181.

The next upside target will be the 1.3227 level. This is the 100 bar on the 4-hour chart. ON Friday, the price traded above and below this MA. Earlier today, the price tested the line, corrected higher and then tumbled below it with the early NY dollar selling. There should be trading interest against the level on the test, but much will likely depend on the oil price. With the US data out of the way and with the Easter Monday holiday in full force, the liquidity conditions remain on the light side.

If the sellers have switched their allegiance to being long, the risk for longs is now the 100 hour MA at the 1.3195. Stay above and all is ok. Move below and with the light liquidity conditions, traders may simply throw in the towel and wait for tomorrow when the trading desks are at full staff.