Forex technical analysis: USDCAD tumbles . Tests swing area and bounces.

Better data sends the loonie higher

The Canada data beat expectations with retail sales leading the charge.

The beats send the USDCAD sharply lower (higher CAD). The fall took the price to a swing area in the 1.27125-218 area (see yellow area on the chart below). The price also fell below the 100 and 200 bar MA on the 4-hour chart at 1.28138 and 1.27772. The 200 bar MA at 1.2777 will be eyed as topside risk (a level to lean against for sellers).

We are currently trading up toward that MA level. I would expect sellers to try and keep a lid on the pair at that level.