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USDCAD Fundamental backdrop

  • Fed vs BoC – The Fed remains on a tightening tilt while the BoC has signaled a more cautious pause; that asymmetry tends to support USD/CAD to the upside.

  • Oil – WTI is trading near $80/barrel, down from spring highs; weaker oil undermines the CAD.

  • Risk flows – With equity volatility picking up, USD safe-haven bids can outpace commodity currencies like CAD.

Overall, the fundamental bias is mildly bullish USD/CAD.

Technical structure

TimeframeWhat’s happeningKey levels
DailyRange bound since April, with higher lows off 1.3570. RSI ~56, carving out a series of higher troughs. Price now pressing the mid-range overhead near 1.3750–1.3780.Support: 1.3570 (June low)
Resistance: 1.4050 (Feb swing high), 1.3750–1.3780 (current congestion)  
4-HourUp-trending channel off June low, bouncing from the 50 EMA and 200 EMA confluence on June 30. Current pullback testing the rising trendline around 1.3665–1.3680. RSI ~60 and climbing.Trendline / 50 EMA confluence: ~1.3665–1.3680
Near-term resistance: 1.3750 

Optimal entry zones & TP : SL scenarios

A) Pullback Long into 4h trendline (lower-risk)

  • Entry: 1.3680 area (rising 4h trendline + 50 EMA)

  • Stop-Loss: 1.3650 (below the June 30 swing low) ⇒ 30 pips risk

  • Take-Profit: 1.3820 (daily mid-range resistance & March swing high) ⇒ 140 pips reward

  • RR: ~ 4.7 : 1

Rationale: You’re buying at intra-day support, in line with the daily higher-low. A fast move to 1.3820 would recapture the March swing, giving ample room for a big winner while risking only a shallow break of the 4h structure.


B) Breakout Entry above daily congestion (trend-following)

  • Trigger: Close above 1.3780 on 4h/Daily

  • Entry: 1.3790 on conviction close/retest

  • Stop-Loss: 1.3765 (25 pips, just under breakout level)

  • Take-Profit: 1.3950 (prior Feb/March supply) ⇒ 160 pips

  • RR: 6.4 : 1

Rationale: A clean breakout of the long-standing 1.3750–1.3780 zone would signal renewed USD strength. You give yourself a tight SL under the flip and aim for the next major supply cluster near 1.3950.

Risk management & next steps

  • Size accordingly so that 30 pips (setup A) or 25 pips (setup B) is within your max per-trade risk.

  • Watch oil and CAD-sensitive data (BoC speakers, Canadian jobs, U.S. CPI) for catalysts that could accelerate the move.

  • If neither zone holds (i.e. price cuts decisively below 1.3650), step aside until a fresh structure forms.


Bottom line:

  • The highest-probability, low-risk long is on a dip into 1.3665–1.3680 (RR ~4.7 : 1).

  • If you’re more trend-oriented, wait for a 1.3780+ breakout (RR ~6 : 1).

Either way, you’re aligning USD strength vs CAD weakness, clustering entries against clear technical pivots, and targeting a TP:SL well north of 3:1.


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