Title: USD/CAD Retests Critical Resistance: Technical Analysis and Market Insights (February 12, 2026)
Author: Originally published by Economies.com
The USD/CAD currency pair continues to show signs of bullish pressure as it revisits a significant resistance level. Traders and investors in the foreign exchange market are closely watching this development, as further movement near this zone could signal upcoming market direction over the short- to medium-term. According to analysis by Economies.com dated February 12, 2026, the USD/CAD pair is testing a key resistance area, setting the stage for either a breakout or a corrective pullback. This article not only explores the technical implications of this price action but also expands on the broader economic and market factors influencing the USD/CAD exchange rate.
Key Technical Overview
According to the analysis presented on Economies.com, the primary characteristics of the current USD/CAD setup include the following:
– The USD/CAD pair is trading near the resistance level of 1.3570.
– Price action shows repeated attempts to break above this level.
– The EMA50 (50-day Exponential Moving Average) is supporting the bullish bias by providing upward momentum beneath the price.
– The prevailing price formation resembles a bullish channel, suggesting continued optimism, should resistance levels be broken with sufficient volume.
– Stochastic oscillators and RSI (Relative Strength Index) are displaying movement near the overbought zone, which could indicate potential near-term volatility or consolidation.
This analysis points toward the likelihood of further upward movement if the resistance at 1.3570 is breached decisively. A confirmed breakout could then target the next significant levels, which are observed around 1.3700 and 1.3800.
Technical Indicators to Watch
To better understand the potential direction of the USD/CAD pair, traders are advised to pay attention to a number of technical indicators:
1. Relative Strength Index (RSI)
– Currently nearing the overbought territory.
– A movement above 70 could indicate that the pair may be overextended in the short term, leading to a corrective retracement.
2. Moving Average Convergence Divergence (MACD)
– The MACD line is trending above the signal line, generally considered a bullish signal.
– Positive histogram bars indicate increasing bullish momentum.
3. Volume Analysis
– An increase in trading volume near the resistance level could confirm a breakout.
– Low volume around resistance may lead to a false breakout or reversal.
Fundamental Factors Influencing USD/CAD
While technical analysis provides visual insight into directional bias, fundamental drivers play a critical role in determining the strength and sustainability of movements. Several macroeconomic factors influence the USD/CAD exchange rate on a daily basis:
1. U.S. Dollar Index (DXY)
– The strength or weakness of the U.S. dollar impacts all USD currency pairs.
– As of mid-February 2026, the DXY is showing relative strength, supported by resilient U.S. economic data and expectations of higher interest rates.
2. Crude Oil Prices
– The Canadian dollar has a historically strong correlation with crude oil due to Canada’s status as a major oil exporter.
– Higher oil prices generally support the Canadian dollar, pushing the USD/CAD pair lower. Conversely, falling oil prices weaken the CAD, favoring bullish movement in USD/CAD.
– Recently, a dip in crude oil prices following increased inventories and concerns about global growth has weakened the CAD, lending strength to the USD/CAD pair.
3. Central Bank Policies
– Federal Reserve (U.S.): The Fed’s continued tightening cycle and messaging about maintaining higher rates for longer have strengthened the USD.
– Bank of Canada (BoC): The BoC’s dovish tone and reluctance to raise rates further have contrasted with the Fed’s hawkish stance, contributing to CAD weakness.
4. Economic Performance Metrics
– U.S. Jobs Data
Read more on USD/CAD trading.