USDCAD extends gains, tests resistance above August highs

A run of technical breakouts has kept the bullish tone intact for USDCAD.

From a September 8 low of 1.3758, the pair has risen 336 pips to hit 1.4094 on Wednesday. Each step higher has followed a consistent pattern of breaking through key technical levels.

First came a move above the 200-day moving average at 1.3839, followed by a break of the 100-day moving average, now sitting at 1.39565. The price also pushed through the 50% retracement of the drop from the June 24 high — at 1.39894 — and then on Tuesday cleared the 61.8% retracement of the same decline, at 1.40503.

These thresholds give traders a framework for judging the move's strength. A level being broken shows buying pressure; holding above it afterward is the next test. When resistance is repeatedly taken out and then holds on pullbacks, the trend has stronger backing from buyers.

The 61.8% retracement held as support on Wednesday

The day's low touched 1.4058, above the 61.8% level at 1.40503. Buyers defended that zone, and the price resumed its climb.

The next break came at 1.4080, which matched the swing highs from August 4 and August 5 — the month's peak levels. Breaking above a prior high attracts attention because it moves price into untested ground. It does not guarantee further gains, but it does open the door for extending the uptrend.

The key question now is whether 1.4080 can flip to support. If it does, the former ceiling becomes a floor — the best near-term outcome for buyers. If the pair slips back below, the breakout loses some force, and traders will watch the next levels to see if buyers re-enter.

Where could sellers begin to gain ground?

Below 1.4080, a rising channel trendline runs near 1.4060. Since the line is rising, its level shifts over time. Just underneath lies the 61.8% retracement at 1.40503.

A fall below those levels would amount to a moral victory for sellers. It would signal that buyers could not hold the August highs and that the latest retracement break had failed. Still, the broader short-term trend would face another major test lower down.

That test is the rising 100-hour moving average, now at 1.40240. USDCAD has traded well above it since breaking higher on September 9. In a trending market, moving averages help distinguish a normal pullback from a genuine shift in direction. As long as the pair stays above the 100-hour moving average, buyers can claim they still control the short-term trend. A break below would tilt the bias more toward sellers.

This is why I watch the levels in steps. A dip below 1.4080 is a warning. A move below 1.4060 and 1.40503 adds to that warning. A break of the 100-hour moving average would be a more significant change in the technical picture.

The next upside target

To the upside, the upper channel trendline points toward the next swing area at 1.41297–1.41488. That zone becomes the next target for buyers if the price can remain above 1.4080.

If USDCAD can clear that swing area, it would enter the broader consolidation zone that reached 1.42474 on June 24. That June high was the highest level since April 8, 2025.

Buyers have done the work to bring USDCAD here. They broke the moving averages, cleared the retracement levels and have now pushed above the August highs. The next task is to hold above the levels they just broke. Stay above 1.4080, and the focus stays on 1.41297–1.41488. Fall back below, and the rising channel line, the 61.8% retracement and ultimately the 100-hour moving average will show whether sellers are starting to take back control.