USD/CAD Price Forecast: Rallies to 1.3970, fresh high since November 2025 on Oil slump
The USD/CAD pair attracts fresh buyers following an intraday dip to the 1.3930 area on Thursday and builds on the overnight bounce from the weekly low. The momentum lifts spot prices to the 1.3970 region, or the highest since December 2025, during the first half of the European session, and is sponsored by an intraday decline in Crude Oil prices, which tends to benefit the commodity-linked Loonie.
Despite renewed hostilities between the US and Iran, reports suggest that diplomatic efforts towards a permanent peace deal are still on track. This keeps hopes alive for a resolution to end the over three-month-old war, which, in turn, is seen as a key factor exerting downward pressure on Crude Oil prices. Adding to this, the Bank of Canada (BoC) maintained a dovish stance as policymakers are prioritizing a sluggish economy over inflation threats. This, in turn, is seen exerting heavy pressure on the Canadian Dollar (CAD) and acting as a tailwind for the USD/CAD pair.
Meanwhile, the aforementioned supporting factors largely offset a modest US Dollar (USD) downtick, led by easing concerns over a runaway inflation spiral following the release of a soft US Consumer Price Index (CPI) on Wednesday. Nevertheless, traders are still pricing in a 70% chance that the US Federal Reserve (Fed) will raise interest rates by the end of this year. This, along with persistent geopolitical uncertainties stemming from the ongoing Middle East crisis, should act as a tailwind for the USD and back the case for a further appreciation for the USD/CAD pair.
Even from a technical perspective, spot prices hold well above the 200-day Simple Moving Average (SMA), retaining a bullish near-term bias and keeping the broader uptrend supported. Moreover, momentum indicators remain constructive but slightly stretched. In fact, the Moving Average Convergence Divergence (MACD) indicator stays in positive territory, hinting that upside pressure persists. That said, the Relative Strength Index (14) is hovering in overbought territory near 74, pointing to the growing risk of a near-term corrective pullback.
On the downside, initial support is located at the 1.3968 area, with a deeper pullback exposing the 200-day SMA at 1.3816, where dip-buying interest could re-emerge. As long as USD/CAD holds above this moving average, the technical structure favors further gains after any consolidation, though overbought readings warn that fresh bullish follow-through may be increasingly selective at current levels.
(The technical analysis of this story was written with the help of an AI tool.)
USD/CAD daily chart
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
As chip stocks plummet, "cybersecurity software" surges across the board, CrowdStrike and Palo Alto Networks hit new highs
CrowdStrike surged 13.8% in a single day to a record high, while Palo Alto Networks soared 13%. The software ETF outperformed the semiconductor ETF by more than 10 percentage points in a single day, marking the largest gap in history. Analysts believe that regardless of the pace of AI development, security demand will only continue to rise. Capital is accelerating its rotation from computing hardware to security software, with segments such as identity management and data governance expected to benefit first.
Altman can afford to wait, but Masayoshi Son can't: OpenAI will not go public this year, exposing a $20 billion gap and a credit weakness for SoftBank.
OpenAI has postponed its public listing, putting its largest external shareholder, SoftBank, in a liquidity crisis. This week, SoftBank is conducting a roadshow in New York, seeking to issue $10-20 billion in bonds to repay the $40 billion bridge loan previously borrowed to increase its investment in OpenAI. According to Bloomberg estimates, SoftBank faces a funding gap of at least $20 billion, and the yield on its existing U.S. dollar bonds has already exceeded 8.5%, with pricing approaching junk status.
Meeting postponed, gold price drops rapidly
The "first metaverse stock" bets on "AI-powered game creation"! Roblox (RBLX.US) competes for creator economy dividends, shares surge nearly 13%
On September 11, after Roblox announced new tools for game developers and features for players at its developer conference, the company's stock price rose by more than 12% on Monday.
Crypto prices
More
