USD/CAD continued its upward momentum for the sixth consecutive day, trading around 1.3930 during European hours on Wednesday, as the pair remains just below the top trendline of an ascending channel, indicating a sustained bullish bias [1]. Technical analysis shows the price is above both the nine-period and 50-period Exponential Moving Averages (EMAs), with the 14-day Relative Strength Index (RSI) at 56, suggesting steady upside momentum without signs of being overbought [1].
The immediate resistance is identified at the top trendline of the ascending channel near 1.3970. A break above this level could reinforce the bullish outlook and potentially open the way for USD/CAD to test the 17-month high of 1.4248, which was last reached on June 24, 2026 [1]. On the downside, support levels are seen at the 50-day EMA of 1.3915, the nine-day EMA of 1.3876, and the lower trendline of the channel at 1.3790. A decisive move below the channel could trigger a bearish reversal, targeting the October 2024 low at 1.3481 [1].
Strategists at Scotiabank highlight that the Canadian Dollar is receiving some support from firmer crude oil prices and steady front-end US-Canada yield spreads. However, they caution that these factors may not be enough to counteract the broader strength of the US Dollar, especially as markets focus on the upcoming FOMC decision. According to Scotiabank, "the CAD will struggle to resist the broader trend in the USD into and around the FOMC decision regardless" [1].
CONCLUSION
USD/CAD maintains a bullish technical setup, with the pair poised to challenge key resistance levels if current momentum persists. While commodity and rate dynamics offer some support to the Canadian Dollar, analysts warn that broader US Dollar strength, particularly around the FOMC decision, could limit CAD gains. Market participants are closely watching for a breakout or reversal as the pair approaches critical technical thresholds.