The US dollar edged higher against the Canadian dollar, with USD/CAD testing the 1.4350 resistance level near its nine-day exponential moving average (EMA). However, the pair struggled to break through as mixed economic signals and fluctuating oil prices kept traders cautious.
The US dollar remained firm, supported by expectations that the Federal Reserve will keep interest rates elevated, despite recent signs of slowing growth. However, with Treasury yields showing limited movement, the greenback lacked a clear directional push, leaving USD/CAD in a consolidation phase.
Meanwhile, the Canadian dollar found some support from a rebound in crude oil prices, as supply concerns offset weaker demand outlooks. With Canada’s economy closely tied to energy exports, oil price movements remain a key factor in influencing the loonie’s strength against the US dollar.
Technical indicators suggest USD/CAD faces strong resistance at 1.4350, with traders closely watching whether the pair can sustain momentum above this level. A clear break could open the door for further gains, while failure to do so may lead to a pullback toward short-term support levels.
Looking ahead, market participants will focus on upcoming US and Canadian economic data, including inflation figures and employment reports, which could influence central bank policy expectations. Any dovish signals from the Federal Reserve or the Bank of Canada may determine the pair’s next major move.
For now, USD/CAD remains in a tight range, with traders awaiting further market cues. Unless economic data or oil prices provide a decisive push, the pair may continue testing resistance without a clear breakout.
