USD/CAD’s upswing looks like it’s running into trouble at a key resistance zone.
The pair has bounced from its May lows, but buyers are starting to look a little tired.
Could this be where USD/CAD turns lower before reaching the bigger technical ceiling?
USD/CAD: Daily
USD/CAD Daily Forex Chart Faster with TradingView
The U.S. dollar has had a bumpy ride this week, getting a boost from US-Iran escalation fears before giving some of those gains back after reports that U.S. and Iranian negotiators tentatively agreed to a 60-day ceasefire extension. On top of that, the April PCE inflation report came in slightly softer than expected on the monthly reading, which took some of the urgency out of Fed hike bets.
The Loonie, meanwhile, held up as a commodity-linked currency with crude prices still elevated and risk appetite recovering into the close.
USD/CAD has bounced from its May lows near 1.3550 and is now poppin’ up red (bearish) candlesticks around the R1 Pivot Point (1.3827).Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your fundie homework on the U.S. dollar and the Canadian dollar, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
If USD/CAD fails to reclaim R1 and sellers stay active, the pair could draw in bearish demand and slide back toward the 1.3703 Pivot Point area. A sustained break below that opens the door to 1.3550 range support, especially if Canada’s monthly GDP scheduled later today beats expectations.
But if Canada’s GDP disappoints and dollar demand returns, especially if the ceasefire deal hits a snag, USD/CAD could break back above R1 and aim for the established range resistance near 1.3950. A clean break above that area puts R2 at 1.4073 back on the radar.
Whichever bias you end up trading, don’t forget to practice proper risk management and stay aware of top-tier catalysts that could influence overall market sentiment.
This USD/CAD setup is shaped by macro drivers like crude oil prices, Canada’s GDP, and U.S. PCE data, and not every reader will be familiar with what typically moves the Canadian dollar. Premium members can read our lesson:
📖 Canada
Reading this helps you understand Bank of Canada policy, how oil and economic data drive CAD movements, and what to watch when forming a directional bias on USD/CAD.
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