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USD/CAD Grapples With Lows Under Weight of Bearish USD Sentiment and Higher Oil Prices

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  • March 17, 2025
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The USD/CAD currency pair continues to see downward pressure, trading at the lower end of its near-term trading range as bearish US Dollar sentiment and higher crude oil prices keep the pair on the back foot. A bull spike in oil due to Red Sea geopolitical tensions and tighter Canadian fundamentals is providing some support to the commodity-linked Loonie. Meanwhile, growing expectations of multiple Fed rate cuts in 2025, coupled with soft US inflation data and a cooling labor market, keep the US Dollar subdued. Traders now await key US economic data and the outcome of the upcoming FOMC policy meeting for clearer directional cues. KEY LOOKOUTS • Markets await the outcome of the FOMC meeting, which could offer fresh clues on future interest rate path and USD direction. • Future US economic statistics such as Retail Sales and Empire State Manufacturing Index can shape short-term USD/CAD direction and sentiment. • Further escalation of Middle East tensions would further push oil prices up, supporting the Canadian Dollar and putting downward pressure on USD/CAD. • Bullish news from recent US-Canada trade negotiations can continue to support the Loonie, keeping upside in the USD/CAD pair in check. Traders are keenly interested in important economic and geopolitical events that may dictate the USD/CAD pair in the near future. The impending FOMC policy meeting is crucial in its importance, with a potential to provide new information on the Federal Reserve’s rate-cut path as US inflation and labor indicators weaken. US Retail Sales and Empire State Manufacturing Index would also be awaited for short-term trading signals. Conversely, increasing crude oil prices, driven by growing tensions at the Red Sea, remain to underpin the commodity-related Canadian Dollar. Additionally, sentiment from recent US-Canada trade talks that was optimistic in nature may keep the Loonie strong and limit any significant appreciation of the USD/CAD pair. USD/CAD is under pressure at the lower end of its range due to a weak US Dollar and higher crude oil prices. Traders are waiting for important US data and the FOMC policy decision for new direction. Favorable US-Canada trade sentiment also favors the Loonie. • USD/CAD stays firm around mid-1.4300s, unable to bounce back due to overall bearish sentiment against the US Dollar. • Crude oil prices jump to a two-week high, propping up the Canadian Dollar on account of its commodity-linked nature. • Geopolitical tensions in the Red Sea drive oil price spikes, bolstering the Loonie and capping USD/CAD upside. • Market expectations of several Fed rate cuts in 2025 weigh heavily on the US Dollar’s strength. • Soft US inflation and moderating labor market numbers reaffirm hopes for dovish Federal Reserve policy. • Positive news recently in US-Canada trade negotiations further encourages investor sentiment in the Canadian Dollar. • Sellers look to later US Retail Sales, Empire State Index, and FOMC meeting for new directional signals in the USD/CAD. The USD/CAD currency pair is currently driven by the larger economic and geopolitical forces dictating the world financial environment. One of the major drivers is the increasing prices of crude oil, which have a direct positive impact on the Canadian economy given its position as a significant oil exporter. The recent increase in oil prices, driven by increased tensions in the Red Sea, has made the Canadian Dollar stronger. Moreover, the positive news from the last US-Canada trade talks has provided a good support for the Loonie, and market sentiment has been enhanced with renewed faith in Canada’s economic prospects. USD/CAD Daily Price Chart Chart Source: TradingView Conversely, the US Dollar is being pressed as expectations grow for the Federal Reserve to take a dovish approach in the following months. Weaker inflation data, slowing signs in the labor market, and expectations for two interest cuts by 2025 have all fed into the weakening USD prognosis. Additionally, renewed fears that the US trade policy will somehow impact the American economy have put even more hesitation. As the traders look forward, the future US economic releases and the policy decisions of the Federal Reserve will have a significant role to play in determining the bigger picture for both currencies. TECHNICAL ANALYSIS USD/CAD currency pair is consolidating in the vicinity of the lower side of its short-term trading band, reflecting a risk-averse market mood. The 1.4350 level is being used as an important support zone, and an unambiguous breach below here can lead the way for more selling. To the upside, recovery efforts will confront resistance at about the mid-1.4400s where selling can get re-instated. The duo’s failure to hold on to a firm upward push is a reflection of the underlying bearish sentiment, with traders still watching price action closely for possible breakout or breakdown cues in the sessions ahead. FORECAST If the USD is able to recover its strength, fueled by better-than-anticipated economic reports or a less dovish Federal Reserve in the next FOMC meeting, USD/CAD may try to recover. A move above the near-term resistance around the mid-1.4400s may fuel further upside action, possibly drawing in new buying interest. If that happens, the pair may target higher levels in the near term, particularly if oil prices stabilize or decline modestly. Conversely, if bearish pressure against the US Dollar persists as more rate cuts and dismal economic indicators are anticipated, USD/CAD could fall further. If the price goes below the 1.4350 support level for an extended period, selling momentum could be triggered once more, directing the pair lower towards further support levels. Moreover, if oil prices keep rising due to geopolitical tensions, the Canadian Dollar might gain further, which could hasten the downside risk for USD/CAD.

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Currencies

USD/CAD Remains Resilient Amid Trade Tensions and Political Uncertainty in Canada

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  • March 10, 2025
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The USD/CAD currency pair remains strong around the 1.4350 level, indicating an upside bias in the face of rising trade tensions and increasing political uncertainty in Canada. The Canadian Dollar is under pressure after China imposed a 100% tariff on major Canadian exports, escalating a wider trade war. In addition, speculation regarding an early federal election in Canada contributes to market uncertainty. While the US Dollar is being burdened with the fear of a possible economic downturn, increasing US Treasury yields provide some respite. With shifting global trade dynamics and unfolding political events, USD/CAD remains in focus for market players. KEY LOOKOUTS • China’s imposition of 100% tariff on Canadian exports can be a big burden for CAD, which could keep USD/CAD in bearish grip in the near future. • Increased speculation regarding an early federal election by PM Mark Carney could enhance volatility and investor risk aversion against the Canadian Dollar. • Albeit economic slowdown fears, increasing US Treasury yields could potentially cap downside pressure on the USD in the next few sessions. • Investors will be keenly observing how fresh US and China tariffs redefine North American trade flows and impact USD/CAD sentiment. The USD/CAD currency pair is charting a complicated course defined by increased trade tensions and political uncertainty. The Canadian Dollar is still on the back foot after China levied a 100% tariff on major Canadian exports, further heating up the ongoing trade war. Speculation surrounding an early federal election in Canada under Prime Minister Mark Carney further obscures the economic outlook. Simultaneously, the US Dollar is under pressure from fears of a possible slump in the US economy, although increasing Treasury yields are providing some support. As the world markets process these events, the USD/CAD pair remains steady around 1.4350, retaining its bullish bias. USD/CAD remains firm around 1.4350 as rising trade tensions and political instability in Canada counteract CAD weakness, while US economic worries limit Dollar strength. • USD/CAD is trading near 1.4350 with a bullish bias as global trade uncertainties and political instability in Canada keep the USD/CAD steady. • China slaps Canadian rapeseed oil, peas, and other goods with a 100% tariff, which fuels trade tensions. • Canadian Dollar is hampered by trade tensions against China and the US affecting investor morale. • Speculation intensifies over Canadian Prime Minister Mark Carney’s possible call for an early election in April or May 2025. • US Dollar softens slightly amid concerns of a US economy slowdown, capping bullish pressure. • Increasing US Treasury yields provide some support to the USD, albeit overall bearish pressure. • Markets remain vigilant in anticipation of the new tariffs effective on March 20, keeping a close eye on geopolitical and economic news. Trade tensions still hold center stage in the economic environment, particularly after China imposed a 100% tariff on a number of Canadian products such as rapeseed oil, peas, and pork. The action follows Canada’s previous tariff moves and has put more pressure on an already strained trade relationship. The move has put Canada’s trade prospects into question, with companies and investors responding to the possibility of affecting exports and the overall economy. These are among a wider global shift that is driven by protectionism, with nations reviewing their trade approach. USD/CAD Daily Price Chart Chart Source: TradingView With added uncertainty, political events in Canada have received more attention. There is speculation that Prime Minister Mark Carney will call an early federal election, potentially late April or early May, ahead of the scheduled October 2025 date. Such political maneuvers would carry high stakes for policy direction and investor sentiment. Conversely, there are also fears emerging about the prospects of the US economy’s growth, even though the economic fundamentals remain under close observation. Against this backdrop, market participants are closely monitoring both trade policies and political actions that may influence the economic environment over the next few months. TECHNICAL ANALYSIS  USD/CAD is showing a robust consolidation trend around the 1.4350–1.4360 level, which reflects a possible accumulation phase. The pair has sustained its bullish setup following recent advances, indicating that buyers remain dominant. Major support is seen at 1.4300, whereas near-term resistance is placed close to the 1.4400 level. A follow-through above this resistance may invite further upside strength, whereas a fall below support may herald a short-term setback. Overall, the pair’s consistent placement close to current highs indicates underlying interest in buying amidst current market uncertainties. FORECAST If trade tensions increasingly become more bearish on the Canadian Dollar, USD/CAD may further extend its climb in the future sessions. Breaking above the resistance level of 1.4400 can bring renewed bullish force, and this may push the pair to test higher levels. Moreover, even the slightest news of political turmoil in Canada, such as an announcement of holding an early election, can support further USD strength against the CAD. Rising US Treasury yields would also offer a basis for sustained upper bias in the pair. Conversely, if diplomatic talks between Canada and her trading partners signal ebbing tensions, the Canadian Dollar may gain stature, piling pressure on USD/CAD downwards. Further, if future US economic numbers indicate a more severe-than-anticipated slowdown, this may detract from investor morale in the US Dollar. A fall below the 1.4300 support level may initiate a corrective move towards lower levels, particularly if global sentiment turns risk-on or oil prices rise, which generally benefits the CAD.

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Currencies

USD/CAD Recover from One-Week Low as Key US and Canadian Jobs Report Looms

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  • March 7, 2025
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The USD/CAD pair recovers from a one-week low, restoring the 1.4300 level as downward bearish Crude Oil prices pressure the Canadian Dollar (CAD) as major employment reports loom from the US and Canada. This is the pair’s first positive action in three days, spurred by repositioning trades and market expectations of the US Nonfarm Payrolls (NFP) release. Nevertheless, a persistent US Dollar (USD) selling bias, spurred by Trump trade tariffs concerns and expected Federal Reserve (Fed) rate cuts, restricts further rallies. In turn, Trump’s short-term tariff reprieves for Canada and Mexico alleviate trade tensions, possibly supporting the CAD and capping USD/CAD’s upside. Traders now await job data releases for clearer directional cues. KEY LOOKOUTS • The pair recovers above 1.4300, snapping a three-day losing streak as traders reposition ahead of key US and Canadian employment data. • Bearish crude oil prices weaken the Canadian Dollar, acting as a tailwind for USD/CAD, but potential BoC policy decisions could cap gains. • Ongoing USD selling, fueled by fears of Trump’s trade tariffs and potential Fed rate cuts, keeps the pair’s bullish momentum in check. • The US Nonfarm Payrolls and Canada’s employment report will be major drivers, dictating the near-term price action and investor sentiment in USD/CAD. The USD/CAD pair recovers from a one-week low, rising back above 1.4300, as the market players reposition prior to the US Nonfarm Payrolls (NFP) data and Canada’s employment numbers. Poor Crude Oil prices are still depressing the Canadian Dollar (CAD), supporting the pair slightly, but the hopes that the Bank of Canada (BoC) will soon halt rate cuts could cap the pair’s upside. At the same time, a persistent US Dollar (USD) selling bias, driven by Trump’s trade tariffs and uncertainty regarding possible Federal Reserve (Fed) rate reductions, contributes to the uncertainty. With market actors waiting for new employment statistics, the short-term prospects for USD/CAD continue to be reliant on economic releases and general risk sentiment. The USD/CAD currency pair bounces higher around 1.4300 due to poor Crude Oil prices and repositioning for major US and Canadian jobs data. Yet, the USD selling bias due to Trump’s trade policy and possible Fed rate cuts might cap higher gains. Sellers now look to NFP and Canada’s employment report for more direction. • USD/CAD rallies from a week low, ending a three-day losing streak due to market repositioning. • Bearish crude oil prices weigh on the Canadian Dollar, aiding USD/CAD’s upside. • Fears of Trump’s trade tariffs and possible Fed rate cuts constrain the US Dollar’s strength. • Speculation that the Bank of Canada might leave rates unchanged might cap USD/CAD’s advances. • Traders wait for the NFP report, which will be important in forming USD price action. • Canadian employment numbers will offer additional guidance for the pair’s direction. • Trump’s exemption of Canadian and Mexican imports from tariffs for one month mitigates fears of trade wars, weakly bolstering the CAD. The USD/CAD pair continues to be under spotlight as the release of US and Canadian employment reports is awaited by traders with anticipation. The releases will offer major indications of both economies’ health and might sway monetary policy moves in the future. Market participants are also intently observing the global economic landscape, especially economic policies and trade relations, which have a significant influence on the sentiment of investors. With evolving trade agreements and central banks monitoring economic stability, traders are aligning themselves depending on possible changes in policy and economic outlook. USD/CAD Daily Price Chart Chart Source: TradingView Another significant determinant of market sentiment is the effect of crude oil prices on the Canadian economy. Being an oil-exporting country, Canada’s economic performance is directly related to the movement in oil demand and supply. Furthermore, recent trade policy developments, such as temporary tariff relief on Canadian and Mexican products, are being watched for their long-term effects on trade relations and economic growth. As investors wait for major employment figures, sentiment is still cautious, and future direction will be based on general economic data and geopolitical events. TECHNICAL ANALYSIS USD/CAD pair has rebounded from a one-and-a-half-week low around the 1.4240-1.4235 area, retaking the 1.4300 level. This bounce indicates a possible short-term support area around 1.4240, and the 1.4350-1.4380 area could be the next resistance point. Despite this, the pair is still at risk of negative moves in a persistent bear trend in the US Dollar (USD). Should bearish selling intensify, breaking below 1.4240 may pave the way for continued losses to 1.4200 or worse. Meanwhile, momentum oscillators such as the Relative Strength Index (RSI) and Moving Averages provide a neutral to slightly bearish inclination, with market participants holding out for vital employment releases to confirm directional themes. FORECAST If the US employment figures beat expectations and favor the US Dollar (USD), the USD/CAD pair may pick up more steam. A move above the 1.4350 resistance level can take the pair to the 1.4380-1.4400 region, where more bullish momentum can be initiated. Additionally, if crude oil prices keep falling, the Canadian Dollar (CAD) can weaken, further favoring an up move in USD/CAD. A hawkish policy from the Federal Reserve (Fed) or rising market risk aversion would also propel the pair higher as investors turn to safe-haven assets. Conversely, softer US job data or economic slowdown signals would trigger a fresh USD sell-off, sending USD/CAD back towards the 1.4240 support area. Should this level be broken, the next key support is around 1.4200, which would leave the door open for further declines. Also, if the Bank of Canada (BoC) is to indicate a more stable or hawkish monetary policy, this might make the CAD stronger, capping gains for USD/CAD. Reversal of crude oil price also might lend some support to the Canadian Dollar, making it more likely that the pair could drop.

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Currencies

USD/CAD Price Forecast: Bulls Target 1.4450 as Momentum Builds

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  • February 27, 2025
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The USD/CAD currency pair maintains its upward momentum, moving above 1.4350 and targeting the important psychological resistance of 1.4450. Technicals such as the 14-day Relative Strength Index (RSI) remaining above 50 and the pair above the nine- and 14-day Exponential Moving Averages (EMAs) validate a building short-term trend. A decisive breach above 1.4450 would set the stage for a retest of the 1.4793 level, last touched in March 2003. On the downside, initial support is at the nine-day EMA of 1.4286, and a breach below this would set the stage for a more significant correction towards the two-month low of 1.4151. KEY LOOKOUTS • USD/CAD continues in an uptrend, staying above major EMAs and boosted by RSI above 50, indicating potential extension to 1.4450 resistance. • A strong break above the psychological level of 1.4450 has the potential to drive the pair to 1.4793, last visited in March 2003. • Near-term support is at the nine-day EMA of 1.4286, with a breakdown below potentially prompting a move towards the two-month low of 1.4151. • A failure to maintain gains above 1.4450 may erode bullish pressure, triggering a possible correction to the three-month low of 1.3927. The USD/CAD currency pair remains in firm bullish mode on the back of its standing above dominant moving averages and the 14-day RSI remaining above 50. The near-term attention is at the psychological resistance level of 1.4450, with a clean break seen taking the pair up towards the 1.4793 level last recorded in March 2003. On the downside, the nine-day EMA level of 1.4286 acts as the first point of support, followed by the 14-day EMA level of 1.4284. A decline below these levels may undermine the short-term bullish perspective and direct the pair to the two-month low of 1.4151. The traders should be careful of a possible pullback if the pair is unable to hold above 1.4450, as it can create a more serious correction towards the three-month low of 1.3927. USD/CAD continues to stay bullish, trading above important EMAs and bolstered by an RSI reading above 50. A break above 1.4450 would drive the pair towards 1.4793, and support at 1.4286 is important to avoid a further pullback. • USD/CAD continues its winning streak, trading above important EMAs and holding a strong short-term bullish bias. • The psychological level of importance at 1.4450 is the next target, with a break higher potentially paving the way to 1.4793. • The nine-day EMA at 1.4286 is the nearest support, closely followed by the 14-day EMA at 1.4284. • The 14-day Relative Strength Index (RSI) is still above 50, supporting the bullish outlook and potential for further gains. • A break above 1.4450 may cause a retest of the 1.4793 level, last seen in March 2003. • Failure of the pair to hold above 1.4450 may initiate a corrective decline to the two-month low of 1.4151. • A more pronounced fall may test the three-month low of 1.3927, which is still a major support level for the long-term trend. The USD/CAD currency pair remains to be of much interest as market forces determine its direction. Releases of economic data, interest rate measures, and international trade patterns are key to determining the performance of the currency pair. Economic stability and monetary policy decisions drive the strength of the U.S. dollar and influence its exchange rate with respect to the Canadian dollar. Further, Canada’s commodity-driven economy, relying heavily on energy exports such as oil, watches its currency waver with changes in the trend of the energy markets. This external impact affects USD/CAD’s trajectory and has USD/CAD under keen observation from traders and investors alike. USD/CAD Daily Price Chart Chart Source: TradingView Political developments and domestic economic reports in both nations contribute further to the movement of USD/CAD. Market mood, investor sentiment, and risk appetite drive changes in demand for the Canadian and U.S. currencies. The bilateral trade relations between the two countries also contribute to the dynamics, with alterations in tariffs, free trade agreements, or cross-border investments affecting exchange rates. Moreover, employment figures, inflation readings, and consumption spending patterns of the U.S. and Canada indicate economic wellness, driving market expectations. Consequently, USD/CAD is still a major pair in the foreign exchange market, showing general economic trends and world financial conditions. TECHNICAL ANALYSIS USD/CAD is still firm as the pair continues to stay above important support levels, showing continued bullish momentum. The price continues to stay above the nine- and 14-day Exponential Moving Averages (EMAs), confirming short-term strength. Also, the 14-day Relative Strength Index (RSI) staying above 50 indicates continued buying pressure. The next important level of resistance is at 1.4450, a psychological level, with a breach likely to push the pair to higher levels. On the downside, support currently lies near the nine-day EMA at 1.4286, and a breach below this may signal a change in momentum. Overall, technical indicators reflect an upward bias, but traders should watch key levels for possible trend reversals. FORECAST USD/CAD’s bearish momentum is still intact, and the pair is looking towards the crucial resistance of 1.4450. A sustained crossover above this psychological level can open the doors towards higher levels, and the next big target is 1.4793, a level witnessed as recently as March 2003. The upward trend is bolstered by technicals and solid market sentiment, and the U.S. currency has been firm amid economic stability. If the buying pressure persists, USD/CAD may continue to appreciate as investors continue to be bullish on the pair’s long-term outlook. On the bearish side, any inability to move above 1.4450 may initiate a corrective pullback, taking the pair to near-term support at 1.4286. A clear break below this level may undermine bullish momentum and take USD/CAD to the two-month low of 1.4151. Further downside pressure can develop if bearish sentiment intensifies, with the pair likely testing the three-month low of 1.3927. Market uncertainties, changing risk appetite, and external economic factors may play a role in reversing the situation, making these support levels very important

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Currencies

USD/CAD Reversal: US Dollar Recovery vs Tariff-Fueled Loonie Jitters

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  • February 24, 2025
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The USD/CAD currency pair recovered around 1.4220 in European trade as the US Dollar regained nearly all of its intraday decline even as dismal US flash PMI data arrived, with market sentiment still subdued amid impending threats of 25% tariffs on imports from Canada. Technical indicators such as a falling triangle pattern and a 20-period EMA indicate a range-bound trend with additional downside risk if important support levels are violated, but a break higher may drive the pair to higher resistance levels. The USD/CAD pair rebounds as the US Dollar recovers from its intraday losses despite disappointing US flash S&P Global PMI data for February. Investor sentiment is becoming cautious against the backdrop of impending fears about possible 25% tariffs for Canadian imports from President Trump, as the Bank of Canada’s Governor threatens of drastic economic ramifications in case tariffs are levied. KEY LOOKOUTS • Move below 1.4151 support, potentially indicating a greater downtrend and driving the pair towards December lows. • US Dollar, since its strength would offset poor US PMI figures and have a strong impact on USD/CAD movements. • Potential tariff news from the US government, since policy changes would again affect investor morale and Loonie stability. • Upside breakout above 1.4246, which would initiate a rally towards resistance levels if market sentiment is supportive. The USD/CAD currency pair has been resilient with a significant rebound to close to 1.4220 as the US Dollar regained intraday losses. Even though poor flash PMI data showed contracting service sector activity in the US, the USD was strong, which helped the Loonie pair. Yet, ongoing uncertainty over prospective 25% tariffs on Canada continues to support a defensive stance for the Canadian Dollar, as President Trump’s review of tariffs further fuels investor anxiety. US Dollar strength will counter weak US PMI figures, and hence the currency recovery will be a key driver for USD/CAD action. Tariff uncertainty is still a major factor, so watch closely for any policy changes by the US administration that may further erode investor confidence and Loonie stability. A fall below 1.4151 may see further selling towards December lows, but good US Dollar resilience holds the pair up even in the face of poor PMI data. Tariff uncertainty is still a major issue, and a breakout above 1.4246 on the upside may release further bullish momentum. • The USD regained its losses rapidly, supporting the pair to recover around 1.4220. • Even after disappointing US flash PMI, the strength of the USD is a major driver. • Speculation of possible 25% tariffs on Canadian imports continues to disturb investor confidence. • The pair is in a descending triangle with a support around 1.4151. • Overlapping of the Loonie price by the 20-period EMA indicates a sideways trend. • The RSI is still in the 40-60 region, showing indecision among market participants. • A bullish move above 1.4246 would potentially see the pair touching resistance areas at 1.4300 and 1.4380, or face further downtrends if it breaks below 1.4151. The US Dollar made a significant comeback in European trading sessions, recovering the majority of its previous losses following miserable US flash S&P Global PMI data. Investors seem to be taking the strength of the US Dollar despite the mixed signals from the economy, showing confidence in the overall strength of the currency. The USD/CAD currency pair has remained strong as the US Dollar recovers from previous losses despite poor US flash PMI figures for February. Investors are looking at the prospects for US monetary policy and the possible effect of an economic slowdown, which has not had a significant impact on the strength of the US Dollar. USD/CAD Daily Price Chart Chart Source: TradingView Meanwhile, market players are still wary as a result of impending threats from possible tariff measures. With President Trump considering not imposing 25% tariffs on Canadian imports and Bank of Canada Governor Tiff Macklem sounding the alarm about dire economic consequences, sentiment on the Canadian dollar is still guarded in this state of uncertainty. TECHNICAL ANALYSIS USD/CAD chart is characterized by a falling triangle formation, with significant support and resistance levels portending future direction. The 20-period EMA overlap signals that there is no strong momentum, while the 14-period RSI, which is always within a neutral range, points to the fact that traders are presently indecisive. Such technical indicators suggest that the market is in consolidation mode, and future price action will be guided by a definitive break from the present balance. FORECAST In case market sentiment turns negative, a breakdown below significant support levels would increase selling pressure, driving the pair towards lower levels seen in earlier sessions. Such a decline may be supported by ongoing economic uncertainties and policy issues, which would lead investors to take a more risk-averse approach that may extend the bearish trend. Conversely, if there is renewed buying interest and momentum picks up, the pair might rally towards higher resistance levels, re-establishing a more bullish trading regime. This would be an indication of enhanced confidence in economic indicators and an adjustment of policy risks, leading to a broader market rebound.

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USD/CAD Sustains the Levels with US Jobless Statistics and BoC Rate Rumors

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  • February 21, 2025
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USD/CAD sustains its levels at 1.4150 as market participants consider contradictory economic cues from the US and Canada. The US Dollar is under pressure in the face of higher-than-projected jobless claims and unpredictable Federal Reserve policy, whereas the Bank of Canada (BoC) is likely to slow down rate reductions owing to persistent inflation. Market mood was lifted by US President Donald Trump’s insinuations about trade talk improvements with China but may be anchored by Canadian lumber tariffs. Participants are anticipating more market direction in the release of the forthcoming US PMI figure, the Canadian Retail Sales, and the address of BoC Governor Tiff Macklem. KEY LOOKOUTS • Higher-than-anticipated jobless claims at 219,000 would have a dampening effect on the US Dollar, affecting USD/CAD moves amidst contrasting Federal Reserve policy cues. • Soaring inflation in Canada would compell the BoC to postpone rate cuts, affecting the Canadian Dollar and pushing USD/CAD volatility. • The US S&P Global PMI data due soon will give us a read on economic activity, influencing Fed policy expectations and affecting the USD/CAD pair. • Fresh US tariffs on Canadian wood might weigh on the CAD, escalating economic uncertainty and further pressuring USD/CAD moves in the near term. USD/CAD continues to be under the radar as market players await significant economic reports and policy moves from the US and Canada. Higher-than-projected US jobless claims have pressured the US Dollar, with mixed Federal Reserve signals compounding market uncertainty. In Canada, ongoing inflation could compel the Bank of Canada to hold off on rate cuts, offering potential support for the Canadian Dollar. Meanwhile, the publication of US PMI data will provide new information about economic activity and impact market sentiment. Furthermore, the effect of new US tariffs on Canadian lumber could put pressure on the CAD, introducing another element of volatility into the USD/CAD pair. USD/CAD holds firm as investors weigh US jobless claims, Federal Reserve cues, and Bank of Canada policy forecasts. US PMI and Canadian Retail Sales will offer major market guidance. In the meantime, fresh US tariffs on Canadian lumber might push the CAD lower, boosting volatility. • The currency pair holds firm against recent losses, with investors looking at economic data and policy news from the US and Canada. • Weekly claims increased to 219,000, higher than the expected 215,000, putting pressure on the US Dollar with worries over labor market stability. • Fed officials mention inflation threats and possible stagflation, keeping markets in doubt over future interest rate moves and how they will affect the USD. • Higher Canadian inflation could encourage the BoC to hold off on rate cuts, potentially to support the Canadian Dollar versus the US Dollar. • The S&P Global PMI reading will give insight into US economic activity and affect sentiment towards the USD. • The announcement of additional tariffs on Canadian lumber by President Trump can pressure the CAD due to Canada being a significant exporter. • Retail Sales data and BoC Governor Tiff Macklem’s speech are being followed closely by traders for additional policy cues that will affect USD/CAD action. The USD/CAD currency pair is still in focus for traders due to economic signals from the US and Canada dictating market moods. The US has released the latest report on jobless claims, where higher-than-projected filings indicate possible changes in the labor environment. Discussions around inflation and money policy persist with Federal Reserve members citing worries regarding meeting the 2% inflation rate. On the Canadian side, inflation is still high, fueling speculation that the Bank of Canada will postpone its expected rate reductions. This move could have a profound impact on businesses and consumers, influencing economic expectations for the next few months. USD/CAD Daily Price Chart TradingView Prepared by ELLYANA Also, global trade updates bring an added dimension of interest to the USD/CAD forecast. US President Donald Trump’s revelation of new tariffs on Canadian timber may impact Canada’s export economy, causing alarm about trade relations and economic stability. Meanwhile, market players are eagerly awaiting Canada’s Retail Sales report and Bank of Canada Governor Tiff Macklem’s speech to learn more about the country’s economic condition. These forces, coupled with more general economic trends, will continue to influence the economic narrative for both nations. TECHNICAL ANALYSIS USD/CAD continues to consolidate above the 1.4150 handle following previous declines, signifying a period of market indecision. The pair is met with near-term resistance at 1.4200, a breakout above which may portend additional upside momentum. On the negative side, the major support level is still 1.4120, and a breakdown below could lead to further decline. The 50-day moving average is also serving as dynamic support, and RSI is close to the neutral level, indicating neither overbought nor oversold levels. Traders will be closely monitoring price action for confirmation of the next move, particularly with the release of economic data soon. FORECAST If USD/CAD can break above the 1.4200 resistance level, then it may signal further upward movement. Strong US economic data, especially robust PMI readings, may support the US Dollar, pushing the pair upwards. If the Bank of Canada also gives a hint that it will proceed with caution regarding rate cuts given the ongoing inflation, the Canadian Dollar may dip, further fueling USD/CAD. Any fresh global uncertainty or risk-off mood could also propel the USD as a safe-haven currency, taking the pair to the next resistance level around 1.4250-1.4300. On the bearish side, if USD/CAD is unable to hold above the support level of 1.4150, it may experience more selling pressure. Poorer US economic news, such as weak PMI numbers or higher jobless claims, could bear down on the US Dollar, causing the pair to fall. In addition, if the Bank of Canada becomes more hawkish or conveys optimism over Canada’s economic strength, the Canadian Dollar will likely get stronger, and USD/CAD will be headed for the next levels of support at 1.4120 and 1.4080. Any uptick in Canada’s Retail Sales will also drive CAD strength and heighten the probability of further

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Currencies

USD/CAD Forecast: Bearish Momentum Grows Pre-Employment of Canadian CPI Inflation Data

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  • February 18, 2025
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USD/CAD is trading close to 1.4205 in early European trading, with a bearish bias pre-employment of Canada’s CPI inflation data publication. The pair is still under pressure below the 100-period EMA, with the RSI indicator continuing to signal bearish momentum. The initial key support level stands at 1.4151, with additional downside potential to 1.4130 and the psychological 1.4100 level. On the positive side, near-term resistance is at 1.4265, with a possible breakout to 1.4310 and 1.4380. Focus remains on Canada’s inflation reading, due to increase 1.8% YoY, which may affect USD/CAD’s next direction. KEY LOOKOUTS        • January inflation report, due at 1.8% YoY, will be a determining factor affecting USD/CAD’s next direction and market mood. • The initial resistance at 1.4265, then 1.4310 and 1.4380, may decide whether USD/CAD makes a bullish reversal. • Important downside levels at 1.4151, 1.4130, and 1.4100 will play a pivotal role in determining whether bear pressure becomes more intense in the short term. • A stronger U.S. dollar would cap downside action, while risk sentiment and economic data releases will influence near-term USD/CAD price action. USD/CAD is also in the limelight as traders wait for Canada’s CPI inflation data, expected to increase 1.8% YoY in January. With the pair hovering around 1.4205, the technicals favor a bearish bias since it is still below the 100-period EMA and the RSI is hovering around 46.25. The key downside levels to keep an eye on are 1.4151, followed by 1.4130 and the psychological level of 1.4100. On the positive side, a break above 1.4265 can drive the pair towards 1.4310 and 1.4380. The sentiment of the market and the strength of the U.S. dollar will determine the direction of the next move in USD/CAD. The USD/CAD currency pair quotes around 1.4205 with a bearish bias prior to Canada’s CPI inflation, due out at 1.8% YoY. Important support areas are at 1.4151 and 1.4100, whereas resistance at 1.4265 may dictate further upside potential. Market sentiment and the strength of the U.S. dollar will dictate the next direction of the pair. • USD/CAD is still in pressure below the 100-period EMA, with the RSI at 46.25 showing continuous downside momentum. • Inflation is forecasted to increase by 1.8% YoY in January, impacting sentiment and possible price action in USD/CAD. • Support appears at 1.4151, with deeper potential downside toward 1.4130 and the psychological area of 1.4100. • Resistance is at 1.4265, a breakout potentially pushing the pair through to 1.4310 and 1.4380. • The performance of the Greenback, along with risk mood, will play the key role in deciding whether USD/CAD goes on losing further or corrects. • The pair is moving below the 100-period EMA, while the Bollinger Bands also indicate greater near-term selling pressure. • Buyers and sellers would keep a sharp eye on Canadian CPI releases as well as wider market dynamics because volatility could inject steep price actions in USD/CAD. The USD/CAD currency pair is still under bearish pressure, trading below the 100-period Exponential Moving Average (EMA), which is a fundamental indicator of negative momentum. The Relative Strength Index (RSI) at 46.25 also supports the negative bias, indicating sellers are still in command as long as it remains below the midline. The Bollinger Bands show rising volatility, with the price approaching the lower band, which is a sign of possible further falls. The initial important support level is 1.4151, which a breakdown below may further speed up selling down to 1.4130 and the psychological support of 1.4100. The levels will play a determining factor in ascertaining whether the bearish trend continues. USD/CAD Daily Price Chart TradingView Prepared by ELLYANA On the other hand, on the resistance, the initial important barrier is at 1.4265, which coincides with the top Bollinger Band. A decisive breakout above this level may drive the pair to 1.4310, which coincides with the 100-period EMA. In case buyers can sustain momentum beyond here, more upside potential is available towards 1.4380, the February 10 high. As long as the price is below key resistance points and the RSI is unable to break above 50, the downside bias continues to prevail. Market participants will be paying close attention to Canadian CPI releases and overall risk sentiment, as these underlying drivers may cause tremendous volatility and determine USD/CAD’s next direction. TECHNICAL ANALYSIS USD/CAD is still bearish, with the pair below the 100-period Exponential Moving Average (EMA), which confirms bearish momentum. The Relative Strength Index (RSI) is around 46.25, which is biased towards sellers as long as it remains below the midline. The initial major support is at 1.4151, a fall below which may open up further losses towards 1.4130 and the psychological level of 1.4100. On the higher side, resistance is encountered at 1.4265, coinciding with the top Bollinger Band, with additional obstacles at 1.4310 and 1.4380. A clear break above these levels may change direction towards a reversal to the upside, but presently, the technical indicators are biased towards a further downtrend. FORECAST USD/CAD has some space for upward correction if important resistance levels are broken. The initial resistance level to monitor is 1.4265, which coincides with the top of the Bollinger Band. A breakout above this level could propel the pair to 1.4310, where the 100-period EMA is the next important barrier. If bullish sentiment gains strength, a prolonged rally may aim at 1.4380, the February 10 high. Favorable U.S. economic news or disappointing Canadian CPI inflation data may provide the impetus for a break higher, pushing fresh interest into the U.S. dollar. Moreover, if risk appetite tips in favor of safe-haven assets, USD appreciation may sustain an upside breakout. On the negative side, bearish momentum is still in control as long as the pair is below the 100-period EMA and the RSI is below 50. The initial important support is at 1.4151, the February 14 low, and a break below this level can pick up selling pressure. The next target on the downside is 1.4130, close to the lower edge of

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Currencies

USD/CAD Maintains Price Above 1.4300: Market Awaits Fed Powell Testimonies Despite Escalation of Tariffs

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  • February 11, 2025
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USD/CAD is currently trading above 1.4300, consolidating as investors await Fed Jerome Powell’s testifying for future interest rate policies. The Fed kept its key rates unchanged at 4.25%-4.50%, with no cuts expected in 2025. In the meantime, the 25% tariffs of Trump on steel and aluminum create pressure on the Canadian economy, making the outlook for the CAD bearish. Market participants also keep an eye on US CPI data for further direction. Technical indicators remain sideways, while resistance is present at 1.4380 and the pair may rise as high as 1.4500. Support below 1.4270 could push prices lower. KEY LOOKOUTS • Investors await Powell’s speech to know whether the Fed is going to extend its interest rates at 4.25%-4.50% in 2025 or not. • 25% tariffs on steel and aluminum may weigh heavily on the Canadian economy, bringing a bearish trend for CAD/USD. • Tocky Wednesday, Consumer Price Index (CPI) data will be out. This will impact market sentiment and further provide cues about inflationary trends affecting Fed policy. • The upside would be further possible only if the USD/CAD breaks above 1.4380. If it drops below 1.4270, a deeper correction can be witnessed. Wednesday’s Fed testimony by Chair Jerome Powell and the subsequent silent of interest rate policy keep the USD/CAD under the spotlight, with investors watching carefully for further clues. Since the Fed has held rates at 4.25%-4.50%, it is of immense interest to see if cuts are delayed until the end of 2025. Meanwhile, tariffs imposed by Trump on steel and aluminum at 25% are going to devastate Canada and will continue to reinforce a bearish view of the CAD. The US CPI data is going to be an important driver for expectations around inflation and monetary policy. Tactically, key resistance is seen at 1.4380. A clear break above here should send prices higher, while any move below 1.4270 should put support at risk and ideally could see a stronger fall. The USD/CAD pair still trades above the 1.4300 line as investors keep an eye out for Fed Chair Powell’s testimonial for key interest rate policies. The announcement of 25% tariffs imposed by Trump on steel and aluminum is weighing against the Canadian Dollar, while positive US CPI later in the session will have enough influence on sentiment. Key level to watch up: 1.4380. Key level to watch downside: 1.4270 • The pair remains steady pending key economic events. • Traders look for signals on how long the Fed will keep rates at 4.25%-4.50%. • The Canadian economy faces pressure as the U.S. imposes tariffs on steel and aluminum. • The inflation report on Wednesday could influence future Fed policy decisions. • Investors remain uncertain, leading to a tight trading range of 1.4270-1.4380. • A breakout above this level could push USD/CAD toward 1.4500. • A break below might push the price lower to 1.4195 and then to 1.4120. The USD/CAD is still trading flat above 1.4300, as traders are waiting for Fed Chair Jerome Powell to testify before Congress. Market participants are looking for clues on how long the Federal Reserve will keep interest rates at 4.25%-4.50%, with many analysts expecting no rate cuts in 2025. Concerns over Trump’s 25% tariffs on steel and aluminum continue to weigh on the Canadian economy, as Canada is the largest exporter of aluminum to the United States. Such levies may mean higher inflation rates in the US, and by extension, that the Fed must continue its existing monetary policy much longer. USD/CAD Daily Price Chart TradingView Prepared by ELLYANA USD/CAD is trading between 1.4270 and 1.4380; 1.4380 serves as a pivotal resistance point for the pair. A breakout above this could take the pair towards 1.4500, whereas a push below 1.4270 could lead to more losses toward 1.4195 and 1.4120. Another event that markets are eagerly awaiting is the U.S. Consumer Price Index (CPI) data scheduled on Wednesday; this will have considerable ramifications in shifting market sentiment and increasing demand for USD. With various economic and political factors present, the outcome of the USD/CAD seems uncertain, but Powell’s testimonial and then the CPI to be released shall be the primary drivers for a future price shift. TECHNICAL ANALYSIS In the USD/CAD, consolidation is seen over a tight band of 1.4270-1.4380 due to the scheduled economic events; the 50-period Exponential Moving Average has been seen resisting the upside trend at around 1.4365. Meanwhile, the 14-period Relative Strength Index (RSI) is in the 40.00-60.00 area, showing a neutral to sideways trend. A break above 1.4380 would be likely to push the pair to the round-level resistance of 1.4500, and then to the January 30 high of 1.4600. A break below 1.4270 could be seen as a trigger for further losses down to the December 10 high of 1.4195 and then to the December 11 low of 1.4120. Traders will watch for the volumes to build and confirmation signs before making a directional bet. FORECAST Should USD/CAD break out of the resistance line at 1.4380, further gains could occur for the currency, and that’s towards round number resistance 1.4500. An increased breakout through the latter would lead the currency pair to move further to January 30 highs at 1.4600 with the boost in positive economic numbers from the US or more hawkish speeches by Fed Chairman Powell. Additionally, sustained inflationary concerns in the U.S., potentially fueled by Trump’s 25% tariffs, could lead to higher USD demand, reinforcing the pair’s upward trajectory. If the Fed delays rate cuts throughout 2025, the U.S. dollar may strengthen further, keeping USD/CAD in an uptrend. On the downside, if USD/CAD goes below the February 5 low of 1.4270, it might reflect increased bearish pressure that could drag the pair toward the December 10 high of 1.4195. Further below this level, it would open the door for a possible dip toward the December 11 low of 1.4120. Any signs of a softer U.S. Release of CPI data or dovish comment from Powell will weaken USD; hence the

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Currencies

USD/CAD jumps to six-day high: Impact of Trump’s tariffs and BoC rate cuts on currency pair

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  • February 3, 2025
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The USD/CAD has surged to almost 1.4700 after US President Donald Trump imposed a 25% tariff on imports from Canada, which is due to take effect on Tuesday. The move has been made while increasing tariffs generally, including the 25% duty on Mexican goods and 10% on Chinese exports, thus increasing tensions in trade. This, in conjunction with the rate differential between the US Federal Reserve and the Bank of Canada, has driven strength in the pair. The rate cut by the Bank of Canada recently and plans for asset purchases contrast with the Fed’s decision to keep rates unchanged, boosting the USD even further. Meanwhile, as retaliation in this trade war from Canada, Mexico, and China looms over, the USD/CAD pair keeps going up for its sixth consecutive trading session. KEY LOOKOUTS • Locking in a 25% tariff on imports from Canada will increase trade tensions and the exchange rate volatility. • The interest rate differential between the Fed and BoC has been the best driver of the current USD/CAD price action, with the Fed holding on to its steady rates. • Canada, Mexico, and China have vowed to retaliate against the US tariffs, which could create broader market uncertainty and influence USD/CAD. • A rising DXY, reflecting USD strength against major currencies, will continue to support the upward momentum of USD/CAD. The USD/CAD pair continues to gain momentum, recently reaching near 1.4700, driven by a combination of factors. The key catalyst has been US President Trump’s imposition of a 25% tariff on Canadian imports, which is set to take effect on Tuesday, contributing to escalating trade tensions. In addition, the ongoing interest rate divergence between the US Federal Reserve, which has kept rates steady, and the Bank of Canada, which recently cut its rate, is supporting the strength of the USD. This, coupled with retaliation threats from Canada, Mexico, and China, and a rising US Dollar Index, is likely to have the USD/CAD pair continuing its upward trend, creating volatility in the forex market. The USD/CAD pair has rallied to around 1.4700 on the back of Trump’s 25% tariff on Canadian imports and interest rate differentials between the Fed and BoC. Threats of trade retaliation and a rising US Dollar Index add further strength to the pair. • The USD/CAD pair has gained more than 1% and rallied to near 1.4700, as recent tariff announcements have driven the pair. • The United States has applied a 25% tariff to Canadian imports effective on Tuesday and further escalates the trade tension. • Energy exports from Canada will attract a 10% tariff, thus putting pressure on the CAD. • The United States has also applied 25% tariffs to Mexican goods and 10% to Chinese exports, thus creating global trade uncertainty. • The interest rate gap between the Fed (steady rates) and the BoC (rate cut to 3%) boosts USD strength. • Canada, Mexico, and China have promised retaliation, which could further influence USD/CAD movements. • The US Dollar Index (DXY) continues to rise, supporting the overall strength of the USD against other currencies. Trade tensions along with interest rate differentials have really driven this pair upwards; trading near 1.4700. The most significant catalyst is the 25% tariff put upon Canadian imports by the U.S. It comes into play this Tuesday and is in response to other tariffs levied upon Mexican goods and Chinese exports, deepening trade tensions. Canadian exports of energy will also suffer from the effect of a 10% tariff, adding further pressure on the CAD. Rising trade tensions have raised the level of concern and further intensified this weakening of the CAD and support for USD strength. USD/CAD Daily Price Chart Sources: TradingView Prepared by ELLYANA The other main driver behind the recent USD/CAD strength has been the divergence of interest rates in the US Federal Reserve and the Bank of Canada. Although the Fed is steady, the BoC lowered its key rate 25 basis points to 3% just last week. Therefore, interest-rate differential works as a more bullish factor, where the return of the USD is higher compared to the CAD. More to this, a US Dollar Index, DXY, which is also on an uptrend enhances the strength of the USD versus the other strong currencies, meaning more momentum on the USD/CAD pair, which is to experience retaliatory moves from Canada, Mexico, and China, therefore, this pair is still on the path to volatility. TECHNICAL ANALYSIS The latest run of the USD/CAD pair to 1.4700 is one huge breakout, because the pair remains above its significant resistance points. This is further complemented by a series of higher highs and higher lows, giving a strong sign of the bull. A hovering RSI overbought territory sees a potential short-term reversal, though the trend still remains intact. The moving averages, mainly the 50-day and 200-day average, are trending bullishly by crossing over, showing strength in the current uptrend. So long as the pair maintains above the support levels around 1.4600, the least resistance path is northward toward 1.4800, but external factors such as trade developments or changes in markets sentiment can quickly lead to reversal even at unexpected times. FORECAST The USD/CAD pair is likely to continue rising as the interest rate divergence between the US Federal Reserve and the Bank of Canada continues. While the Fed has been steady, the BoC has recently taken a dovish approach with rate cuts, making the USD more attractive than the CAD. Furthermore, continuing US tariffs on Canadian goods in addition to ongoing trade tensions, and a hardening US Dollar Index (DXY), would likely push the pair to fresh highs. However, if USD/CAD sustains above 1.4600 support, the next serious resistance could come around 1.4800, with room for further runs if geopolitical tensions escalate. On the flip side, if the trade tensions were to ease significantly or if the monetary policy unexpectedly changed, it could pull the USD/CAD back. Since the RSI is in an overbought condition, this could be an opportunity for short-term

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Currencies

USD/CAD Struggles Near 1.4300 Amid Tariff Threats and Economic Concerns

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  • January 22, 2025
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The USD/CAD pair trades cautiously near 1.4300 amid heightened economic and political uncertainty. US President Donald Trump’s threat to impose a 25% tariff on Canada has dampened the Canadian economic outlook, prompting a strong response from Canadian Prime Minister Justin Trudeau, who stated that his government is ready to respond to any scenario. Additionally, expectations of a 25 bps rate cut by the Bank of Canada (BoC) following weaker-than-expected inflation data have further pressured the Canadian Dollar. In contrast, the US Federal Reserve is anticipated to hold interest rates steady, amplifying policy divergence. Technically, USD/CAD remains range-bound but shows a firm outlook, with potential for a rally above 1.4518 or a downside break below 1.4120. KEY LOOKOUTS • Follow US-Canada trade developments, as a 25% tariff from Trump will be huge for the Canadian economy and its dynamics in the USD/CAD market. • The upcoming decision of the BoC will likely be 25 bps, which might affect CAD sentiment and the broader economic forecast. • Resistances are seen at 1.4518 and support at 1.4120; it might act as a break out or breakdown point for considerable price action. • Maintain an eye on the fight between the Fed’s hawkish stance and the BoC’s dovish tone, which forms investor emotion and currency trends. USD/CAD now hovers around 1.4300 with market attention still on US-Canada trade wars and differing monetary policies. US President Donald Trump announced a 25% tariff over Canada, where he faces a stiff response from Canadian Prime Minister Justin Trudeau. The BoC has been touted to reduce interest rates by 25 basis points for its meeting, which is expected to follow the rather disappointing inflation data. In sharp contrast, the US Federal Reserve maintains a steady policy that further weighed in against the Canadian Dollar. Technically, this is a range-bound movement of USD/CAD with key levels such as 1.4518 and 1.4120, and any breakout will likely define the directional trend. USD/CAD trades circumspectly near 1.4300 amid US-Canada tariff tensions and expectations of a BoC rate cut. Diverging monetary policies and key technical levels at 1.4518 and 1.4120 remain critical. • Pair trades cautiously with economic and political uncertainties weighing down on market sentiments. • US President Donald Trump proposes a 25% tariff on Canada that raises concerns of economic impacts. • Prime Minister Justin Trudeau says he is prepared to act on any trade issues if tariffs are implemented. • The Bank of Canada is expected to reduce interest rates by 25 bps to 3% in its next policy meeting. • The CPI data for December showed a fall in annual inflation to 1.8%, which has been fueling dovish BoC bets. • The US Federal Reserve is likely to hold interest rates, which will widen the policy gap with the BoC. • USD/CAD is range-bound, with resistance at 1.4518 and support at 1.4120, setting critical breakout levels. The USD/CAD pair trades near 1.4300, reflecting market caution amid heightened economic and political uncertainties. US President Donald Trump’s threat of a 25% tariff on Canada has intensified concerns about the Canadian economy, with Prime Minister Justin Trudeau affirming readiness to counter any challenges. Additionally, expectations of a 25 bps rate cut by the Bank of Canada (BoC), driven by weaker December inflation data, have weighed on the Canadian Dollar. In contrast, the US Federal Reserve’s steady interest rate stance highlights the growing policy divergence between the two central banks. Technically, USD/CAD remains range-bound, with key levels at 1.4518 and 1.4120 likely to dictate the next significant move. USD/CAD Daily Price Chart. Source: TradingView Prepared By ELLYANA US Federal Reserve is expected to maintain its current interest rate policy, highlighting the growing policy divergence between the two economies. This divergence has boosted the appeal of the US Dollar against the Loonie. From a technical perspective, USD/CAD has been range-bound for over a month, trading within the 1.4260-1.4465 band. Key resistance at 1.4518 and support at 1.4120 are critical levels to watch, with a breakout likely signaling the pair’s next major directional move. Market participants remain focused on trade developments and upcoming monetary policy decisions, which could significantly impact the pair’s trajectory. TECHNICAL ANALYSIS From a technical perspective, USD/CAD has been trading in a tight range of 1.4260 to 1.4465 for over a month, reflecting market indecision. The 50-day Exponential Moving Average (EMA) slopes upward near 1.4235, signaling a bullish undertone despite the range-bound movement. Meanwhile, the 14-day Relative Strength Index (RSI) remains within the neutral 40-60 range, indicating a lack of clear momentum. A decisive break above the resistance at 1.4518 could pave the way for a rally toward the psychological level of 1.4600 and potentially the March 2020 high of 1.4668. Conversely, a downside break below the December 11 low of 1.4120 might lead to further weakness, targeting the December 4 high of 1.4080 and the key psychological support at 1.4000. Traders should watch these critical levels for confirmation of the next directional move. FORECAST USD/CAD shows potential for an upward breakout, supported by the 50-day EMA’s upward slope near 1.4235, which reflects a bullish bias. A sustained move above the immediate resistance level at 1.4518 could send the pair further north. A break above that level could then take the pair to round-level resistance at 1.4600 and the March 2020 high of 1.4668. The steady interest rate stance of the Federal Reserve and the vulnerability of Canada’s economy to trade tensions with the US further bolster the upside outlook. Positive momentum indicators and a possible rally in the US Dollar may push the pair to these higher levels. USD/CAD fails to hold above the 1.4260 level, it may come under downward pressure. A break below the December 11 low of 1.4120 may send the pair further down to the December 4 high of 1.4080 and the psychological support at 1.4000. Weak Canadian inflation data, coupled with expectations of a Bank of Canada rate cut, could weigh on the Canadian Dollar. However, a resolution of US-Canada trade tensions or stronger-than-expected

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