USD/CAD is gaining for a fourth consecutive session, trading near 1.3785. The pair has broken back above its short-term uptrend line and retraced more than half of its recent pullback from multi-month highs to a seven-week low. The CAD remains pressured, with lower oil prices weighing amid US-Iran peace expectations.
Momentum indicators support the near-term bullish outlook, albeit cautiously. The MACD is advancing in positive territory, while the RSI trends higher but shows signs of easing, suggesting buyers maintain control, though upside momentum is not yet fully convincing.
Immediate resistance lies at the 200-day SMA, aligning with the 61.8% Fibonacci retracement of the March 31 – May 1 decline, near the key psychological 1.3800 level. A break above this zone would expose the 78.6% Fibonacci at 1.3876, ahead of the three-month peak near 1.3965.
On the downside, initial support is seen at the 50% Fibonacci level around 1.3757, followed by the 50-day SMA tightly below near 1.3740. Further weakness could test the 38.2% Fibonacci near the 1.3700 handle, with stronger support at 1.3647. A move below this level would shift the bias back to bearish, as price would fall below all major SMAs.
In summary, USD/CAD needs to hold above the reclaimed uptrend line to sustain its bullish bias, while a decisive break above the 200-day SMA remains critical for a stronger upside extension.
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