USD/CAD Reversal from Channel Resistance Continues

USD/CAD rates are continuing their reversal lower within their multi-month uptrend following last week’s Canadian jobs figures. Stronger than expected jobs growth in Canada has helped tamp down Bank of Canada (BoC) rate cut odds through the end of the year, while the prospect of Trump’s tariffs being struck down by the Supreme Court have likewise emboldened the Loonie. In the options market, Canadian Dollar futures are currently in the 48th percentile for volatility over the past year, highest among major USD-pairs.

USD/CAD Price History

In the above chart, USD/CAD rates have backed away from rising channel resistance, marked by the February 2025 swing low near 1.4151. The reversal in recent sessions is pushing the pair back into the area between the 20-day exponential moving average (EMA) and 50-day EMA, which proved itself as support at the end of October. A drop below the 100-day EMA would produce a break of the rising channel in motion since mid-June. At first blush, dip buyers may be in play closer to 1.3900 on a continued pullback.

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