USD/CAD Holds Above 1.3950 as Bulls Eye Resistance at 1.4016

USD/CAD Price Forecast: Tests Initial Support Around 1.3950, Then Nine-Day EMA

The USD/CAD pair is trading near 1.3950 during Monday’s European session, retreating slightly after reaching a fresh six-week high of 1.4016 last week. The pullback is seen as a technical pause rather than a reversal, as the pair continues to respect a rising channel pattern on the daily chart, reflecting a broader bullish bias.

Despite the minor correction, the 14-day Relative Strength Index (RSI) remains just above the neutral 50 level, suggesting ongoing upward momentum and the potential for further gains if support holds. Additionally, USD/CAD remains above its nine-day Exponential Moving Average (EMA), currently located at 1.3936, which is providing a short-term technical floor.

Key Technical Levels:

• Immediate support: Nine-day EMA at 1.3936
• Major support: Channel base near 1.3900
• Initial resistance: 1.4016 (six-week high from May 13)
• Next resistance: 1.4023 (50-day EMA), followed by 1.4100 (upper boundary of the bullish channel)

A break above the 1.4016–1.4023 resistance zone would reinforce the bullish trend and open the door to test the upper end of the rising channel near 1.4100. On the flip side, failure to hold above the nine-day EMA could trigger a deeper retracement, but strong buying interest is expected near the 1.3900–1.3920 area.

The broader market focus remains on US Dollar dynamics, oil price movement (which impacts the Canadian Dollar), and upcoming economic data from both countries. As long as the USD/CAD pair holds above key moving averages and within the bullish channel, bulls remain in control for the short to medium term.