USDCAD Forecast and Technical Analysis – July 23, 2025
Adapted and Expanded from an article by Christopher Lewis, DailyForex
The USD/CAD currency pair has shown considerable fluctuations recently, reflecting a mix of economic indicators, oil prices, and central bank actions from both the United States and Canada. On July 23, 2025, the pair is situated in a complex technical landscape, with traders weighing in on several important influences.
This in-depth analysis takes the original insights provided by Christopher Lewis for DailyForex and expands upon them with additional context from current market trends, economic data, and other expert opinions. The goal is to provide a comprehensive view of where the USD/CAD is likely headed in the short to mid-term.
Overview of the Current Market Situation
The USD/CAD pair has been trading in a consolidative pattern for several sessions. As of July 23, 2025, the pair has encountered resistance near the 1.3750 level while finding support around 1.3600. This range reflects a tug-of-war between bullish U.S. dollar sentiment, driven by anticipated interest rate policy, and strengthening crude oil prices that usually support the Canadian dollar.
Key Influences on USD/CAD at This Time
Several macroeconomic and geopolitical factors are currently influencing USD/CAD price movements. These include:
– Interest rate expectations from the Federal Reserve and the Bank of Canada
– Crude oil price trends, which strongly affect the Canadian dollar
– The strength of the U.S. dollar against a basket of major world currencies
– Economic indicators relating to GDP growth, inflation, and employment
– Market sentiment tied to global geopolitical tensions and risk appetite
Technical Analysis of USD/CAD
Price Structure
Currently, the USD/CAD currency pair is trading within a broad sideways channel between 1.3600 and 1.3750. The channel’s ceiling has been tested multiple times but not yet broken decisively, suggesting ongoing consolidation.
Key Technical Levels
– Resistance Levels:
– 1.3750: A critical psychological level and historical resistance
– 1.3800: A stronger barrier that could open the door for a move toward 1.3900
– 1.3860: A potential extension target in case of a breakout
– Support Levels:
– 1.3600: Offers strong support on daily and 4-hour timeframes
– 1.3550: A lower support level that has previously acted as a launchpad
– 1.3480–1.3500: A zone of historical buying interest
Indicators and Patterns
Several technical indicators offer insight into the likely behavior of the USD/CAD pair:
– 50-Day EMA: The 50-day Exponential Moving Average is currently around 1.3660, acting as dynamic support. If the price continues to trade above this level, bulls may remain in control.
– RSI: The Relative Strength Index is hovering around 54. This neutral reading suggests a balance between buying and selling forces.
– MACD: The Moving Average Convergence Divergence has shifted into slightly bullish territory with a recent crossover, signaling modest upside potential.
– Candlestick Patterns: Multiple rejection candles around the 1.3750 area indicate that this is a strong resistance level. A daily close above this level could shift the market into a more bullish stance.
Short-Term Outlook
The short-term outlook for USD/CAD remains cautiously bullish as long as the pair holds above the 1.3600 support zone. However, without a firm breakout above 1.3750, a continued range-bound pattern may persist. Breaks below 1.3600 would likely shift the short-term trend to bearish.
Medium-Term Fundamentals
U.S. Dollar (USD) Drivers
The U.S. dollar’s recent strength has been largely fueled by the Federal Reserve’s hawkish stance. High inflation readings in June and early
Read more on USD/CAD trading.