Insights 
VT 
Canadian Dollar Performance Against Major Currencies
The USD/CAD currency pair is trading around 1.4050, maintaining a bullish trend seen in the daily chart. With the pair hovering near the nine-day Exponential Moving Average (EMA) of 1.4036, and the 14-day Relative Strength Index (RSI) above 50, the bullish bias remains strong.
There’s potential for USD/CAD to retest its seven-month high of 1.4140. Should it push past this milestone, further movement could see the pair challenge the ascending channel’s upper boundary at 1.4190.
Support levels to watch include the nine-day EMA at 1.4036 and the channel’s lower boundary near 1.4000. A breach below the 50-day EMA of 1.3969 may shift sentiment to bearish, potentially revisiting the three-month low of 1.3721.
From a broader standpoint, the heat map shows currency percentage changes, with the Canadian Dollar performing strongest against the Australian Dollar. The forex market remains dynamic, with currency fluctuations against major currencies monitored closely by traders and analysts.
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Investment Strategies and Risks
With the USD/CAD pair holding firm around 1.4050, the technical setup points towards continued upward movement within its ascending channel. The Relative Strength Index is above 50, which suggests that bullish momentum is still in place. We should view the nine-day EMA at 1.4036 as the first line of defense for the current trend.
This bullish outlook is reinforced by fundamental factors, as the US just reported that Non-Farm Payrolls for October 2025 rose by a stronger-than-expected 210,000 jobs. This persistent strength in the US labor market suggests the Federal Reserve will be in no hurry to cut interest rates. The strong dollar sentiment makes a test of the recent high of 1.4140 seem increasingly likely.
On the other hand, the Canadian economy is showing signs of slowing down, with the latest inflation data from October 2025 falling to 2.6%, closer to the Bank of Canada’s target. This has increased market bets that the BoC could begin an easing cycle before the Fed, creating a policy divergence that favors a higher USD/CAD. This pattern is reminiscent of the divergence we observed in late 2023 that drove the pair higher.
Adding to the pressure on the Canadian dollar, we have seen West Texas Intermediate (WTI) crude oil prices fall by over 5% in the last two weeks, now trading near $76 per barrel. Weakness in oil, a critical Canadian export, typically weighs on the loonie. Given this backdrop, the path of least resistance for USD/CAD appears to be upward.
For the coming weeks, we should consider strategies that profit from a rise toward the 1.4190 upper channel boundary. Buying call options with a strike price of 1.4150 and a December 2025 or January 2026 expiration could capture this expected move. The defined risk of an option makes it a suitable tool in this trending environment.
Alternatively, for those with a more neutral-to-bullish bias, selling put spreads with the short strike below the key 1.4000 psychological support level could be an effective way to collect premium. This strategy benefits from both a rising price and time decay, as long as the pair does not break down through its support. The key risk to this outlook would be a sharp reversal in oil prices or a surprisingly weak US economic report.
