USD/CAD Price Forecast: Eases from one-week top; trades near 1.3650 ahead of jobs data

• USD/CAD edges lower on Friday, snapping a two-day winning streak, though the downside seems limited.
• Traders seem hesitant amid persistent geopolitical uncertainties and ahead of US/Canadian jobs data.
• A bullish technical setup further warrants caution before positioning for any meaningful depreciation.

The USD/CAD pair struggles to build on its gains registered over the past two days and trades with a mild negative bias during the Asian session on Friday. Spot prices, however, hold above mid-1.3600s and remain close to a one-week top ahead of crucial employment details from the US and Canada.

In the meantime, hopes for a potential US-Iran peace deal keep a lid on any meaningful appreciation for the safe-haven US Dollar (USD) and cap the upside for the USD/CAD pair. However, a fresh leg down in Crude Oil prices is seen undermining the commodity-linked Loonie and acting as a tailwind for the currency pair. Traders also seem hesitant and opt to wait for the release of the US Nonfarm Payrolls (NFP) report and Canadian jobs data.

From a technical perspective, the USD/CAD pair holds a constructive near-term bullish bias as it trades above the 100-period Simple Moving Average (SMA) and the 23.6% Fibonacci retracement level of the recent fall from the March swing high. Adding to this, the Relative Strength Index (RSI) around 61 suggests positive but not yet overbought momentum, while the Moving Average Convergence Divergence (MACD) remains in mildly positive territory.

Momentum indicators, in turn, hint that upside pressure could persist as long as the currency pair defends its nearby floor. On the topside, initial resistance is seen at the 38.2% Fibo. retracement at 1.3708, with further hurdles at the 50.0% level at 1.3757 and the 61.8% retracement at 1.3807. A break above these would expose the 78.6% retracement at 1.3876 and the cycle high region near 1.3965.

On the downside, immediate support is provided by the 100-period SMA at 1.3653 and the 23.6% retracement at 1.3648, with a deeper pullback targeting the structural base around 1.3550.

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

USD/CAD 4-hour chart