USDCAD hit its lowest point since October 2024, falling to 1.3534 last Thursday before bouncing back slightly on Friday. The drop started at 1.4015 on May 13 after testing the 200-day moving average. For a brief moment, it went below a key trendline support at 1.3643 but quickly lost its downward momentum. On Friday, a recovery was supported by U.S. and Canadian jobs reports, pushing the pair above the 100-hour moving average. However, it struggled to maintain this position by the end of the week.

Short Term Movement

Earlier today, USDCAD dipped below the 100-hour moving average but quickly rose above it again as market dynamics changed. The 100-hour moving average is now a short-term pivot point. Staying above this level may signal the start of a corrective recovery. For stronger bullish momentum, USDCAD needs to climb above the 200-hour moving average and stay there. The price briefly exceeded this mark on May 29 and May 30 but couldn’t hold it, leading to more selling pressure. A sustained break above this level would be a strong indicator of a shift in market sentiment. This currency pair has recently shown uncertainty, fluctuating between clear movements and struggles at technical thresholds. The sharp decline since mid-May reversed the previous upward trend, pushing prices past a long-standing supportive trendline—at least for a moment—before buyers regained some control. The bounce after last Friday’s employment figures marked a brief change in momentum. This created a hint of upward movement, but it lacked staying power. The failure to stay above the 100-hour average towards the end of the session indicated hesitation from traders. However, today’s recovery and return above this level suggests that this average is being closely monitored for directional confidence.

Market Sentiment

Traders are likely to watch price activity around this average for signs of stronger conviction. So far, any movements beyond this point have been reactive rather than sustained. Isolated touches or quick breaks do not provide much insight. Last week’s repeated failures to stay above the 200-hour average show that sellers remain active and focused on that level. It has become a barrier rather than a gateway. Whether this continues depends significantly on whether buying interest can shift from opportunistic to determined. From a technical perspective, the 200-hour figure now represents a clear threshold. Moving above it and maintaining that position would require volume and alignment—where speculative interest meets fundamental support. This didn’t happen during the last attempts, leading to doubts as repeated tests lack follow-through. Traders are ready to resist these levels until proven otherwise. Given the choppy market behavior over the past two weeks, recent price actions indicate a cautious market that reacts more than it predicts. In the short term, if the price stays above the 100-hour line, it may allow for intraday corrective moves. However, without establishing a solid base above the 200-hour measure, the risk of downside engagement remains. Further trend development is unlikely without a stronger catalyst. We’re closely monitoring interactions with these averages—not as fixed indicators, but as checks on market pulse. Traders planning for the next week should focus on sustained breaks rather than momentary breaches. The recent noise makes quick reactions less trustworthy. A steady presence above or below these levels will provide much clearer signals than fleeting spikes. Create your live VT Markets account and start trading now.

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