Insights 
VT 
The USDCAD fell to session lows, testing the 1.3617 support level, last week’s low. This decline followed the pair’s inability to stay above the 100- and 200-hour moving averages, as sellers took control.
Optimism about a renewed U.S.–Canada trade deal contributed to the Canadian dollar’s strength. Canada withdrew its proposed Digital Services Tax, allowing trade discussions to resume and positively impacting sentiment.
Key Support Area
The 1.3617 level is a key support area. A break below could increase downward momentum, targeting 1.3591 and the 2025 low of 1.3539. Immediate resistance is at 1.3651, with further resistance at 1.3668, marking the June range’s midpoint.
Support levels include 1.3617 and 1.3591, while resistance levels are at 1.3651, 1.3668, 1.3686, and 1.3703. The trend is bearish below resistance and a break below 1.3617 may lead to testing the yearly low. Recovering 1.3668 could reduce bearish momentum.
The recent slip in USDCAD to test the 1.3617 zone reflects widespread positioning around last week’s base. As price failed to clear the confluence of short- and medium-term moving averages, sellers grew confident and pushed the pair lower, tipping the balance back toward defensive plays. The lack of follow-through in attempts to hold above those averages was a decisive signal that buyers lacked the conviction to protect recent gains.
We’ve seen reactions like this before when fundamental shifts get reinforced by technical setups. In this case, the softening stance by Canadian lawmakers—most notably through shelving the Digital Services Tax proposal—helped thaw formerly stalled trade talks. The move arguably improves the longer-term trade outlook between the two economies, but the immediate effect shows up in renewed demand for the Canadian dollar, narrowing attention toward USD-based weakness.
Focus Turns To Follow Through
Now, with 1.3617 under pressure, the focus turns to follow-through. If sellers push the pair lower and sustain movement below that point, then fresh downside markers such as 1.3591 and further down to 1.3539, the low seen earlier in the year, come into play with more credibility. That latter figure marks a structural low many will be watching to determine whether the broader trend continues bleeding lower.
Unless the pair can reclaim 1.3651 soon, and preferably even 1.3668, rallies might struggle to extend. That 1.3668 figure matters because it splits the recent monthly range in half, acting as an equilibrium point. Movement through it would help unwind some of the downward momentum and may hint that short coverage is underway. Above that, we’d keep an eye on 1.3686 and 1.3703, though both would require a fairly determined shift in sentiment to become relevant in the near term.
Price action underneath 1.3668, especially under 1.3651, frames a continued bearish tone. The lack of buying interest around the 100- and 200-hour moving averages confirms that there’s little appetite for chasing the dollar higher unless data or drivers shift.
In practical terms, we treat short-term rallies with suspicion as long as the pair remains contained within that lower zone. While unwinding can occur and may trigger squeezes toward the middle of the June range, sustained bid presence would be needed to maintain those moves. For now, we treat these levels not just as markers of interest but also as tripwires for further activity.
That said, the map is clear: below 1.3617, more downward exploration seems likely. Should momentum carry through 1.3591, the path to testing the 2024 low at 1.3539 opens with greater ease. Whether that happens in a single session or over several depends largely on participation and macro headlines. Until then, the burden sits on the buyer’s side to demonstrate intent above the resistance thresholds.
