USD/CAD is showing a slight increase, trading near 1.3690 during the early European session on Thursday. The pair maintains a negative perspective beneath the 100-day EMA on the daily chart. The immediate resistance is identified at 1.3750, while the initial support is observed at 1.3490. The USD/CAD pair shows resilience, approaching 1.3690 in the early hours of European trading on Thursday.
The anticipation of a more gradual approach to rate cuts by the US Federal Reserve, with Kevin Warsh set to take over from Jerome Powell as Fed Chair in May 2026, bolsters the US Dollar in its performance against the Canadian Dollar. The financial markets are reflecting almost a 90% probability that the Fed will maintain interest rates at its March policy meeting, with expectations of a cumulative easing of 50 to 75 basis points by year-end.
In the current landscape, increasing geopolitical risks may elevate crude oil prices, potentially offering support to the commodity-linked Loonie. Canada stands out as a significant player in the oil export market, and elevated crude oil prices typically exert a favorable influence on the CAD. On the daily chart, USD/CAD continues to be constrained beneath the 100-EMA. The average trends downward, maintaining a bearish outlook. RSI at 46 (neutral) has increased slightly, suggesting that momentum is becoming more stable.
Bollinger Bands are positioned downward, with the price remaining below the middle band, indicating ongoing bearish momentum. If bulls manage to regain 1.3750, upward movements would encounter resistance at the 100-EMA located at 1.3813 and the upper band at 1.4012. Conversely, a new decline would bring 1.3490 into focus.