USD/CAD Price Forecast: Could rebound toward six-month highs near 1.4000

USD/CAD loses ground for the second consecutive day, trading around 1.3930 during the European hours on Wednesday. However, the technical analysis of the daily chart indicates the pair is moving upwards within the ascending channel pattern, signaling an ongoing bullish bias.

The USD/CAD pair is holding a bullish near-term bias as it extends above both the nine-day and 50-day Exponential Moving Averages (EMAs) and supports the pair to test the immediate barrier at the six-month high of 1.3969, recorded on June 9, followed by the upper boundary of the ascending channel around 1.3990.

The 14-day Relative Strength Index (RSI) near 69 indicates strong but nearly overbought momentum that could slow the pace of gains even if the broader upside structure remains intact.

The initial support lies at the nine-day EMA of 1.3900. A break below the short-term price average would weaken the price momentum and put downward pressure on the pair to explore the region around the 50-day EMA at 1.3785, aligned with the lower boundary of the ascending channel around 1.3780. Further declines would expose the 1.3481, the lowest level since October 2024, which was recorded on January 30.

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