The USDCAD is moving higher in early North American trading helped by stronger initial jobless claims, and building on bullish momentum after a successful test of key downside support.
Last week, buyers leaned on the 1.3555 support level, which also held above the 2025 low at 1.35389. The strong bounce from that area marked a critical turning point and kept the broader bullish bias intact.
Adding to the bullish tone, the pair formed a corrective low within a key swing area between 1.3617 and 1.3633—a level that had previously acted as both support and resistance. Holding that area and rotating higher from it served as a strong technical clue that buyers were gaining confidence.
Today, price action has extended further to the upside, taking the pair back above both the 100-bar and 200-bar moving averages on the 4-hour chart (currently near 1.3670–1.36835). Regaining these moving averages—especially after slipping below them earlier in the week—represents a shift in near-term control back to the buyers.
With the bullish momentum building, the high for the week at 1.37094 becomes the first key upside target. Just above that, the 38.2% retracement of the broader decline from the April high, which comes in at 1.37208, adds further technical significance. A break above this level would bolster the bullish case and open the door for further gains.
Beyond that, traders will be eyeing the 1.37498 to 1.3759 swing area. This zone has repeatedly acted as a ceiling in recent months (see red numbered circles), and a move above it would represent a more decisive shift toward a medium-term bullish breakout. A sustained push through this level could pave the way toward the next major resistance closer to 1.3800.
What would kill the bullish momentum?
A move back below the 200 and then 100 bar MAs on the 4-hour chart. That would disappoint the buyers in the USDCAD.
In summary, buyers have reasserted control after defending key downside levels and reclaiming broken moving averages
