FX.co ★ Wiking | USD/CAD

USD/CAD continues to attract strong buying interest, with the pair climbing toward the critical 1.3910–1.3930 resistance zone after extending its recovery from May lows. The daily chart shows a market firmly under bullish control, supported by a resilient US Dollar, softer crude oil prices, and improving expectations that the Federal Reserve may keep monetary policy restrictive for longer. While momentum remains positive, the pair is now approaching a significant technical barrier where bulls may face their first meaningful test in weeks. USD/CAD Pushes Toward Key Resistance as Dollar Strength Challenges the Loonie The latest advance has been driven by a combination of stronger US economic data and easing geopolitical concerns in parts of the Middle East. The ceasefire agreement between Israel and Lebanon reduced support for crude oil prices, which directly pressured the commodity-sensitive Canadian Dollar. At the same time, stronger-than-expected ADP employment data and robust JOLTS Job Openings reinforced confidence in the US labor market, encouraging traders to price in a more hawkish Federal Reserve outlook. This macro backdrop continues to favor the US Dollar against the Canadian Dollar. Trend Direction Remains Firmly Bullish The daily chart presents one of the clearest bullish structures among major currency pairs. USD/CAD has maintained a steady sequence of higher highs and higher lows since bottoming near the 1.3560 area in late April. Price remains above the 20-day moving average, the 100-day SMA, and the Bollinger middle band, confirming strong trend alignment. The recent breakout above the 1.3835 resistance area further strengthened bullish sentiment and opened the door for another leg higher. Buyer vs Seller Pressure Buyer pressure remains dominant. The latest bullish candles show strong follow-through momentum, with very limited pullbacks despite approaching a major resistance zone. Sellers have struggled to generate meaningful reactions, and every dip has attracted fresh demand. However, the pair is now entering an area where profit-taking could increase, particularly around the January highs. While bulls remain in control, traders should watch closely for signs of exhaustion near resistance. Support, Resistance, and Breakout Levels Immediate resistance is located at 1.3910, which aligns with the upper Bollinger Band and the current swing high. A daily close above this level would strengthen the bullish outlook further and expose the January 16 high at 1.3928. Beyond that, attention would shift toward the March 31 peak near 1.3966, which represents the next major upside target. On the downside, initial support is found at 1.3835, the recent breakout zone and June 3 low. Below that, stronger support emerges near 1.3780, where the Bollinger middle band provides dynamic support. Additional protection sits at the 100-day SMA around 1.3720, followed by the lower Bollinger Band near 1.3648. Together, these levels form a broad demand zone that would need to break before the bullish trend comes into question. Indicators and Bollinger Band Analysis Technical indicators continue supporting the upward move. RSI is hovering around 71, slightly above the traditional overbought threshold. This highlights strong bullish momentum but also suggests the rally may be becoming stretched in the short term. MACD remains firmly positive, with the histogram expanding and confirming continued buying pressure. Stochastic is also elevated above 90, signaling strong momentum but warning that short-term consolidation may develop before the next move. The Bollinger Bands reinforce the bullish outlook. Price is pressing directly against the upper Bollinger Band near 1.3910, a sign of persistent upside pressure and expanding volatility. Trading near the upper band confirms buyer dominance, although it can also increase the likelihood of temporary pauses or shallow pullbacks. The middle Bollinger Band near 1.3780 remains the key dynamic support level and continues to define the underlying trend. Bullish and Bearish Scenarios The bullish scenario remains active while USD/CAD holds above 1.3835. A break above 1.3910 and 1.3928 would likely trigger another wave of buying toward 1.3966. Continued weakness in crude oil and further evidence of US economic resilience would support this outcome. The bearish scenario would require a rejection near current resistance followed by a break below 1.3835. Such a move could trigger profit-taking and expose 1.3780, although a deeper decline would still require a break beneath the 100-day SMA to meaningfully alter the trend. Conclusion USD/CAD remains one of the strongest bullish setups among major currency pairs. The combination of firm US economic data, softer oil prices, and a technically healthy uptrend continues to support higher prices. While momentum indicators suggest the rally is becoming stretched, there is little evidence that buyers are ready to surrender control. As long as support at 1.3835 remains intact, the path toward 1.3928 and potentially 1.3966 remains the dominant market narrative.