The forex is alive today, with volatility and significant trading ranges on display. Perhaps none is more active than the USD/CAD, posting a nice rebound after the massive Wednesday sell-off. Fundamentals have driven this market, led by a bounce in WTI crude oil pricing, the release of Canadian employment figures, and lagging U.S. economic metrics.

An upcoming event that may further shake up the Loonie is the 1:30 PM EST speech of BoC Governor Lawrence Schembri. With a slew of Canadian metrics due out tomorrow, his commentary may drive even more participation to this market.

USD/CAD Technicals

My Tuesday trade recommendation calling for a long from Fibonacci support proved to be a miserable loser.  Since being stopped under 1.2500, price is in position to rebound.

The bearish participation that spelled doom for this trade came immediately following yesterday’s EIA crude oil inventories report. Inventories came in at 1.841 million barrels, almost one million below projections. The report prompted strength in WTI crude oil pricing, driving the USD/CAD south.

Here are the support levels to watch for the remainder of the session:

• Support(1): 38% Retracement of Current Bull Run, 1.2517
• Support(2): Bollinger MP, 1.2499
• Support(3): 20 Day EMA, 1.2493

Overview: At press time, this market is trading just north of the 38% retracement near the 1.2525 quarter-handle. Depending upon what BoC Governor Schembri says, this market may be poised to rally from here. Downside support levels around 1.2500 have held, lending credence to the bullish bias.

There are few things worse than being stopped out before catching an anticipated move. Simply put, there are no moral victories in trading — only profit or loss. The jury is still out on whether or not this will be the case for Tuesday’s trade recommendation, but it appears likely.