USD/CAD Price Forecast: Struggles near mid-1.3800s as bears await break below 200-day EMA

The USD/CAD pair extends its weekly downtrend for the third straight day and dives to a nearly two-week low on Wednesday, though it lacks follow-through selling. Spot prices trade around mid-1.3800s, down nearly 0.30% for the day, amid mixed fundamental cues.

The US Dollar (USD) comes under intense selling pressure and plummets to a nearly one-month low in reaction to the optimism led by the US-Iran ceasefire. Furthermore, Iran’s Foreign Minister, Seyed Abbas Araghchi, said that safe passage through the key waterway will be possible for a period of two weeks, triggering a steep decline in Crude Oil prices. This, in turn, undermines the commodity-linked Loonie and helps limit losses for the USD/CAD pair.

From a technical perspective, the Moving Average Convergence Divergence (MACD) indicator (12, 26, 9) shows the MACD line still above the signal line but converging and drifting back toward the zero line, suggesting fading bullish pressure rather than outright bearish control. Moreover, the Relative Strength Index (RSI) has eased from overbought readings above 70 to the high-50s, indicating that upside momentum is cooling but not reversing.

Adding to this, the US/CAD pair stalls the intraday downfall just ahead of the key 200-day Exponential Moving Average (EMA) breakpoint. This makes it prudent to wait for a sustained break and acceptance below the said support near the 1.3815 region before placing fresh bearish bets and positioning for additional losses to deeper support around 1.3750. Further downside, if seen, could target 1.3680 as the next key near-term floor.

On the topside, initial resistance stands at 1.3925, the recent high zone that capped advances, followed by 1.3970. A daily close above 1.3970 would reopen the path toward the 1.4050 area, reinforcing the prevailing bullish bias.

(The technical analysis of this story was written with the help of an AI tool.)

USD/CAD daily chart