The USDCAD has been on a strong bullish run since May 1, rallying from a low of 1.35492 to a high of 1.42470. That high was reached on June 24 and then matched again on June 25 and June 30, creating a triple-top resistance area.
That triple top gave sellers an opportunity to take control last week. The ensuing decline pushed the pair below both the 100-hour and 200-hour moving averages, then near 1.4205, signaling a shift in short-term momentum.
However, the downside move lost steam before reaching the next key support zone between 1.4130 and 1.4143. The low stalled at 1.4149, just ahead of that target, suggesting sellers were unable to generate enough momentum for a more meaningful break.
From there, buyers began to regain control. The price rotated higher on Friday, although the rally initially stalled near the 100-hour and 200-hour moving averages, which had turned into resistance.
Today’s trading has seen a more decisive move. The pair has climbed back above both moving averages and built a base above them, reinforcing the bullish bias. The rally has since extended to 1.4238, leaving the pair just nine pips shy of the 1.4247 triple-top resistance.
With the price back above the key moving averages, buyers have regained the technical advantage. The next challenge is a break above the triple-top high. A move through that level would open the door for another leg higher, while failure there could once again attract sellers looking to defend the resistance.
In the video above, I break down the key technical levels driving the USDCAD, including the current bias, upside and downside targets, and the risks traders should be watching.
