The USDCAD is currently trending upwards in early US trading and testing the 200-hour moving average (MA). Earlier, buyers defended the 100-hour MA, preventing further decline and managing to control the short-term trend.
Key support levels include the 100-hour MA at 1.4318 and a weekly low at 1.4268. The resistance level is at the 200-hour MA, approximately 1.4360, and a major resistance area between 1.4448 and 1.4471 exists.
Bullish And Bearish Scenarios
A bullish scenario would involve a break above the 200-hour MA, targeting the major resistance area. Conversely, a failure at this level could lead to a pullback towards the 100-hour MA, with a deeper decline possibly retesting the low.
This upward movement illustrates that buyers have managed to halt declines by defending support levels, keeping momentum on their side. The ability to hold the 100-hour moving average earlier in the session suggests demand remains intact. That said, the test of the 200-hour moving average becomes a focal point—breaking above it would reinforce strength, while rejection could invite fresh selling pressure.
Resistance at the 200-hour moving average near 1.4360 needs to be overcome for further gains. If this level is cleared, upside targets come into play, primarily around the 1.4448–1.4471 range, which previously acted as a barrier. This zone could attract profit-taking or renewed selling, creating a challenge for those looking to push the pair higher. However, if buying activity remains firm, momentum could carry it beyond.
Potential Downside Risk
Should sellers gain control, failure to hold above 1.4360 would shift attention back to the 100-hour moving average at 1.4318. Buyers defending this level earlier suggest it remains a reliable support, but if it breaks, focus moves to the weekly low at 1.4268. A drop below that point could create a broader downside move, forcing traders to reassess positioning.
For now, the market is at an inflection point. The response to resistance will influence direction in the coming sessions, and traders will be looking to establish control on either side of these key levels. Price behaviour should be monitored closely.
