Insights 
VT 
USDCAD experienced a decline, reaching a new low for 2025 after breaking below critical technical levels. The previous October 2024 low was surpassed, hitting a confluence of support at approximately 1.36443.
This level intersects with a rising trend line that has shaped the bullish structure since late 2023. On the hourly chart, last week’s attempt at surpassing the 50% retracement of the May decline at 1.38505 failed, paving the way for a downward trend. Sellers pushed the price below the 100-hour moving average, maintaining a bearish stance as the pair dropped further into the close of the week.
Key Turning Point
Early attempts to rise were thwarted near a previously broken swing area, ushering in renewed selling pressure. As a result, USDCAD reached a fresh low for the year, momentarily falling below 1.3685. Despite this, the break was short-lived, which indicates potential indecision among traders.
The level 1.3685 now serves as a pivotal point. Any decisive move below it would emphasise downward momentum, while a continued inability to maintain that low could attract buyers and initiate a potential rebound. This situation reveals a delicate balance between the current bearish pressure and the possibility of recovery.
As we interpret the most recent shifts, it’s clear that the momentum has tilted in favour of sellers. The collapse beneath the October low from the previous year marks a departure from the structured rises that had underpinned the pair since the end of 2023. That specific break — down to a support zone hovering around 1.3644 — intersected with a broader rising trend that had carried weight for some time. By falling through it, the market has effectively eroded what had been a reliable floor for several months.
That said, the response near 1.3685 was telling. After breaching the boundary — even if only briefly — the price struggled to hold below it, which is not uncommon in such environments. These kinds of failures at new lows can often act as a warning, especially when follow-through dries up. It suggests that, while sellers had the upper hand, there may be hesitation to press the advantage further without clearer short-term incentives.
Wednesday and Thursday’s price action emphasised this undecided stretch — we observed multiple failures to regain ground above major short-term lines, including last week’s mid-level retracement near 1.3850. That level, in particular, had capped several rebound attempts, highlighting a broader reluctance from buyers to step in ahead of clearer signals. From our perspective, the confirmation of a high and the confirmation of a low — each absent at this stage — would materially change the character of this market.
Current Market Dynamics
We now find ourselves measuring any move against that 1.3685 line. It’s acting as a gravitational point of sorts — when prices hover near such a boundary but fail to commit to a new move, it tells us we’re stuck in indecision. Traders in our position should be watching for forceful closes either side of this number. If the market breaks down again and sustains that break into the 1.36s, the next zones we keep an eye on would be around 1.3595, perhaps even stretching toward late-2023 pivot areas.
Volume patterns have also played their part. There’s been no overwhelming participation on either flank, which somewhat dampens the reliability of any shallow breaks. We think it’s wise at this stage to be sceptical of any price extension that comes without solid backing — especially as the broader path continues to follow a sequence of lower highs.
One could argue that the longer the market stalls in this band, the greater the eventual reaction becomes. Whether it’s a renewed leg lower or the snapback rally many have been positioning for, the energy building around these levels isn’t likely to dissipate quietly. The pair’s past reluctance to respect retracement levels — like the 50% mid-point of May to June’s move — adds conviction to that view.
From a momentum standpoint, we’re taking cues from the hourly moving averages. The 100-hour and 200-hour lines are currently giving room for downward continuation, especially given the way sellers have rejected multiple re-tests of the former. Until that pattern breaks, there’s no obvious pressure forcing a regime change.
Volatility remains somewhat compressed, which only amplifies the importance of what comes next. An expansion in range — combined with a break of recent hourly structure — could open the door to layered technical action. We’re attentive to the idea that compression of this sort usually precedes trend acceleration.
In quiet moments like this, we’re cautious but flexible — measuring opportunity not just in the direction of the last wave, but in the strength shown at each decision point on the chart.
