USD/CAD Pullback Tests Near-Term Supports Within Uptrend Channel

Key Moments

USD/CAD trades near 1.3890 after three consecutive daily advances, holding within an ascending channel on the daily chart.
The 14-day Relative Strength Index stands at 60, signaling bullish momentum while avoiding overbought territory.
Key support is identified at the nine-day EMA around 1.3864 and the 50-day EMA near 1.3853, with resistance seen toward 1.3970 and 1.4014.

Technical Overview: Uptrend Intact Despite Intraday Softness

USD/CAD edges lower during European trading on Friday, easing to around 1.3890 after rising for three straight sessions. Daily price action continues to unfold within an ascending channel, pointing to an underlying bullish structure despite the latest pullback.

Momentum readings reinforce this constructive tone. The 14-day Relative Strength Index is positioned at 60, remaining above the 50 midline and indicating that buying interest is still in control while conditions are not yet stretched. This configuration tends to limit the depth of corrective moves.

Moving Averages Support Bullish Bias

Short-term trend signals remain supportive. The nine-day Exponential Moving Average has turned higher and now sits above the 50-day EMA, with spot prices trading above both lines. This alignment maintains a topside bias for USD/CAD.

At the same time, the 50-day EMA has begun to flatten following an extended period of decline, suggesting that downside pressure has been easing. As long as the pair holds above these shorter-term averages, the focus stays on potential retests of resistance rather than a trend reversal.

Key Levels: Resistance and Support Within the Channel

On the upside, the initial technical objective is the upper boundary of the current ascending channel, located near 1.3970. A move through that area would expose the recent seven-week peak at 1.4014, which was recorded on December 2.

On the downside, any further pullback is expected to encounter first-line support at the rising nine-day EMA around 1.3864, followed by the 50-day EMA at 1.3853. A sustained drop below these moving averages would likely slow the bullish advance and pivot attention toward the lower boundary of the ascending channel around 1.3790.

A clear break beneath that lower channel line would undermine the prevailing bullish bias and could open the way for a move toward the five-month low at 1.3642, which was posted on December 26.

European Update: #USDCAD finally gave it a go.
A push back into 1.39 challenged the prior high at 1.3920 and failed.
We're back near 1.39 and another decision to be made.
At least we're developing a decent range from 1.3860/70 to 1.3920.
That gives levels to trade between,… pic.twitter.com/koIqqzuSA7
— Forex Analytix (@forexanalytix) January 16, 2026

USD/CAD Daily Chart Context

The pair’s current position within the rising channel, together with supportive momentum and moving average signals, frames the market as consolidating recent gains rather than reversing them. Traders are monitoring whether the latest intraday softness evolves into a deeper correction or simply offers a pause before another attempt at the 1.3970 and 1.4014 resistance zone.

(The technical analysis of this story was written with the help of an AI tool.)

Canadian Dollar Performance Against Major Currencies

The Canadian Dollar’s relative performance is summarized in the following table, which shows the percentage change of CAD against other major currencies. On this basis, the Canadian Dollar was strongest versus the US Dollar.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.06%	-0.07%	-0.25%	-0.03%	-0.05%	-0.34%	-0.14%
EUR	0.06%		-0.01%	-0.20%	0.03%	0.00%	-0.27%	-0.08%
GBP	0.07%	0.01%		-0.19%	0.04%	0.02%	-0.26%	-0.07%
JPY	0.25%	0.20%	0.19%		0.25%	0.21%	-0.08%	0.12%
CAD	0.03%	-0.03%	-0.04%	-0.25%		-0.04%	-0.32%	-0.12%
AUD	0.05%	-0.01%	-0.02%	-0.21%	0.04%		-0.29%	-0.09%
NZD	0.34%	0.27%	0.26%	0.08%	0.32%	0.29%		0.20%
CHF	0.14%	0.08%	0.07%	-0.12%	0.12%	0.09%	-0.20%

The heat map should be read by selecting the base currency from the left-hand column and the quote currency from the top row. For example, choosing the Canadian Dollar as the base currency and the US Dollar as the quote shows the percentage change for CAD/USD in the corresponding cell.