The Canadian Dollar (CAD) has experienced a slight decline, primarily due to the minor increase in the US Dollar (USD). The USD/CAD risk reversal pricing indicates a shift, with the 3-month riskies trading at their highest premium for USD puts since 2009.

Bank of Canada Governor Macklem and Finance Minister Champagne are expected to address domestic issues such as inflation and rate outlook following the Banff G7 meeting. The recent core inflation data for April suggests a June rate cut is unlikely, though market expectations regarding rate adjustments may be further reduced.

Usd Cad Resistance Levels

The USD/CAD pair has seen a modest rise from a recent intraday low, though broader trend indicators suggest a bearish perspective for the USD. Technical analysis points towards a resistance level around 1.39, with potential pressure developing near the 1.3745/50 support zone.

Bitcoin enthusiasts are celebrating a new all-time high price, trading above $110,000 for the first time. Retail sentiment is improving, but institutional investors remain cautious due to macroeconomic uncertainties, including trade tensions and U.S. debt concerns.

The Canadian Dollar has softened ever so slightly, largely reacting to a firming U.S. Dollar. What stands out isn’t just the mild upward drift in the USD/CAD exchange rate, but rather the pressure building up in sentiment indicators. One of those is the 3-month risk reversal, which shows the premium for downside protection (USD puts) climbing to levels not seen in 15 years. This means those hedging or speculating with derivatives are prepared to pay unusual amounts to guard against or benefit from moves lower in the pair. The shift hints at a growing view that the current strength in the greenback could be temporary — or potentially overstated, if only due to broader structural concerns.

Governor Macklem and Minister Champagne are soon expected to comment following international discussions, but their focus will likely remain inward on domestic inflation and interest rates. The inflation data from April, notably the core metrics, did not drop off the way markets would have liked. As a result, expectations for a rate cut in June took a hit. Even further out, some pricing around future rate cuts has started to thin out. There’s a growing sense that the central bank won’t be hurrying into easing unless there’s clearer slack in price momentum. This introduces a tighter pinching of carry dynamics, which may cap CAD downside in the short term.

Bitcoin Market Dynamics

USD/CAD did lift slightly from a handling zone that had been tested intraday, but this isn’t being read as a trend shift yet, not by us or the broader technical setups. The resistances still hang heavy — we’re watching the area around 1.39, a place where prior rallies stalled out. Below that, the 1.3745/50 region is keeping it all supported for now; a slip through there could prompt an uncoiling that stretches into multi-week positioning.

Following on a different axis, Bitcoin has thrust into a fresh historical peak, crossing above the $110,000 mark. This rally is being cheered noisily from the outer rings of the market, mostly among retail interest. But behind the front-line gains, there’s a tentativeness from large players. For them, it’s not just about price action, but also broader instability—ranging from cross-border trade drama to persistent anxieties over fiscal management in the U.S. That hangover remains a drag.

At a desk level, this divergence in sentiment styles—retail’s enthusiasm versus institutional restraint—is something to track particularly for those considering optionality setups tied to momentum or volatility. Expectation skew continues to price in more upside tails, but the enthusiasm hasn’t been matched with an equivalent build-up in open interest from the heavyweight accounts. That alone suggests any sharp upward moves might be more thinly supported and quick to mean revert if policy or data starts to reroute conviction.

As we scan a bit forward, there’s a lot on the docket—rate path commentary, inflation prints, and positioning unwind risks all in play. Volatility sellers may need to stay lighter and pickier, as underpriced risks could revalue quickly.

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