USD/CAD continued its decline for the second consecutive session, trading around 1.3710 during Asian hours on Monday, with the near-term bias remaining mildly bullish as the pair advanced above both the nine- and 50-day Exponential Moving Averages (EMAs) at 1.3697 and 1.3696, respectively [1]. Technical analysis indicates that momentum is improving, supported by the 14-day Relative Strength Index (RSI) holding in the mid-50s after recovering from sub-40 readings, which signals increasing buying pressure rather than overbought conditions [1].
The daily chart shows USD/CAD hovering near the upper boundary of a rectangle channel pattern at 1.3750. A breakout above this level would confirm a bullish bias and could see the pair targeting the three-month high of 1.3928, last recorded on January 16 [1]. On the downside, immediate support is at the psychological 1.3700 level, closely aligned with the nine- and 50-day EMAs. A move below these averages could trigger further downward pressure, potentially pushing USD/CAD toward the lower boundary of the rectangle at 1.3540 [1].
In terms of broader currency performance, the Canadian Dollar was the strongest against the Australian Dollar today, with a 0.71% gain. Against the US Dollar, CAD rose by 0.11%, while it also posted gains versus the Euro (0.33%), British Pound (0.27%), and Japanese Yen (0.18%) [1]. The heat map provided illustrates these percentage changes among major currencies, highlighting CAD's relative strength in today's trading session [1].
No forward-looking statements or analyst opinions beyond technical analysis were provided in the article [1].
CONCLUSION
USD/CAD is testing a critical support level at 1.3700, with technical indicators suggesting mild bullish momentum and improving buying pressure. The Canadian Dollar showed strength against most major currencies, particularly the Australian Dollar. Market participants should watch for a breakout above 1.3750 or a drop below the EMAs for further directional cues.