Test the underside of the broken trend line
The USDCAD as moved sharply lower in the European session, and in the process fell below a lower trend line on the hourly chart at 1.3969. However, the pair has found support buyers ahead of a swing area at the 1.39203 to 1.39301. The low for the day reach 1.3935 so far.
The pair is currently testing the underside of the broken trend line. That is close resistance on a rebound. A move above would have traders looking toward a higher swing area at 1.3987 to 1.3999 (see blue numbered circles). The fall below that level earlier today increase the bearish bias. A move above would muddy the waters and likely lead to more short covering.
If resistance on the correction holds, then a downside break of the swing area 1.3920-30 would have traders looking toward the April low 1.38548.
