USDCAD pair is testing a critical resistance area near 1.3830 after a strong rebound. But the price structure is beginning to flash signs of exhaustion. With repeated rejections and a clear double-top pattern forming, the setup favors a bearish move. If momentum turns, we could see a meaningful correction toward the 1.3730 support zone, with deeper downside risk into mid-September.
Current Bias
Bearish rejection at resistance, structure favors downside continuation.
Key Fundamental Drivers
Canada: Weak August jobs report (unemployment 7.1%, wages cooling) raised BoC cut expectations, pressuring CAD. But oil prices (Brent ~$65) limit the downside risk, giving CAD some commodity support.
U.S.: Weaker jobs (+142k NFP, unemployment 4.3%) keeps Fed cuts on the table, capping USD upside. Core PCE sticky at 2.9%, but inflation trend is moderating.
Macro Context
Interest Rates: Fed expected to cut in coming months; BoC markets price ~90% chance of a September cut.
Economic Growth: U.S. slowing but still resilient, Canada contracting (Q2 GDP −0.4% q/q).
Commodities: Oil’s soft rebound provides CAD with some stability.
Geopolitics: Trade tensions (U.S. tariffs, China-Russia bond coordination) keep USD supported as a defensive hedge.
Primary Risk to the Trend
A sharp oil sell-off would weaken CAD and trigger USD/CAD upside.
U.S. CPI surprise to the upside could reprice Fed expectations, boosting USD.
Most Critical Upcoming News/Event
U.S. CPI (this week): Will decide Fed cut timing.
BoC September rate decision: High probability of a cut, market focus on forward guidance.
Leader/Lagger Dynamics
USD/CAD is typically a lagger — following USD direction (via Fed expectations) and CAD flows (via oil). It often mirrors oil price action and diverges from USD/JPY, reflecting risk sentiment shifts.
Key Levels
Support Levels: 1.3732, 1.3585
Resistance Levels: 1.3830, 1.3875
Stop Loss (SL): 1.3875
Take Profit (TP): 1.3732 (first), 1.3585 (extended)
Summary: Bias and Watchpoints
USD/CAD is leaning bearish after failing to break cleanly above 1.3830. Fundamentals point to a tug-of-war between dovish BoC expectations and weaker U.S. data, but the chart structure favors downside into 1.3732 and potentially 1.3585. My stop loss sits above 1.3875 to protect against a breakout. Watch U.S. CPI as the key driver: a hotter print could revive USD strength, while a softer read could accelerate CAD gains. Oil’s stability remains a secondary but important factor for CAD resilience.
Current Bias
Bearish rejection at resistance, structure favors downside continuation.
Key Fundamental Drivers
Canada: Weak August jobs report (unemployment 7.1%, wages cooling) raised BoC cut expectations, pressuring CAD. But oil prices (Brent ~$65) limit the downside risk, giving CAD some commodity support.
U.S.: Weaker jobs (+142k NFP, unemployment 4.3%) keeps Fed cuts on the table, capping USD upside. Core PCE sticky at 2.9%, but inflation trend is moderating.
Macro Context
Interest Rates: Fed expected to cut in coming months; BoC markets price ~90% chance of a September cut.
Economic Growth: U.S. slowing but still resilient, Canada contracting (Q2 GDP −0.4% q/q).
Commodities: Oil’s soft rebound provides CAD with some stability.
Geopolitics: Trade tensions (U.S. tariffs, China-Russia bond coordination) keep USD supported as a defensive hedge.
Primary Risk to the Trend
A sharp oil sell-off would weaken CAD and trigger USD/CAD upside.
U.S. CPI surprise to the upside could reprice Fed expectations, boosting USD.
Most Critical Upcoming News/Event
U.S. CPI (this week): Will decide Fed cut timing.
BoC September rate decision: High probability of a cut, market focus on forward guidance.
Leader/Lagger Dynamics
USD/CAD is typically a lagger — following USD direction (via Fed expectations) and CAD flows (via oil). It often mirrors oil price action and diverges from USD/JPY, reflecting risk sentiment shifts.
Key Levels
Support Levels: 1.3732, 1.3585
Resistance Levels: 1.3830, 1.3875
Stop Loss (SL): 1.3875
Take Profit (TP): 1.3732 (first), 1.3585 (extended)
Summary: Bias and Watchpoints
USD/CAD is leaning bearish after failing to break cleanly above 1.3830. Fundamentals point to a tug-of-war between dovish BoC expectations and weaker U.S. data, but the chart structure favors downside into 1.3732 and potentially 1.3585. My stop loss sits above 1.3875 to protect against a breakout. Watch U.S. CPI as the key driver: a hotter print could revive USD strength, while a softer read could accelerate CAD gains. Oil’s stability remains a secondary but important factor for CAD resilience.
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✅ 85% Accuracy | 1–2 Signals/Day
💰 Profitable Trades Sent Daily – No Cost
📲 Join Us on Telegram
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✅ 85% Accuracy | 1–2 Signals/Day
💰 Profitable Trades Sent Daily – No Cost
📲 Join Us on Telegram
t.me/ultreos_forex
🎯 Upgrade to VIP:
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Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.