Canadian Dollar Between Trend and Correction 26/8/2025

The USD/CAD pair recovered gradually from previous session losses, posting a bullish rebound that lifted the pair to a high of 1.3865.

Technical Outlook – 4-hour timeframe:

The 50-period simple moving average continues to support the potential for a bullish daily price path, reinforced by the pair’s stability above the 1.3820 support level. However, the Relative Strength Index (RSI) is hovering near overbought territory, signaling limited room for further upside without a correction.

Likely Scenario:

Given the mixed technical signals, it is preferable to monitor price action closely to confirm the next move. A break below 1.3820 would generate negative pressure, opening the way for a retest of 1.3790, with an extension toward 1.3750. Conversely, a clear break above the 1.3870 resistance would strengthen bullish momentum, setting the stage for further gains toward 1.3900, followed by 1.3930.

Warning: Risks remain elevated amid ongoing trade and geopolitical tensions, and all scenarios should be considered.

Disclaimer

Trading in CFDs involves risks, and therefore all scenarios are subject to potential outcomes. The analysis provided above is not a recommendation to buy or sell but rather an illustrative reading of price action on the chart.

S1: 1.3825	R1: 1.3870
S2: 1.3790	R2: 1.3900
S3: 1.3740	R3: 1.3935