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The USDCAD currency pair pushed to a multi-week high of 1.4023 before stalling just short of its next upside target at 1.4050, which aligns with the 61.8% Fibonacci retracement of the June decline. The inability to extend the rally triggered profit-taking and brought sellers back into the market, pulling the price back toward the critical 1.4000 technical level. Price action is currently focusing on a key swing zone between 1.3990 and 1.4003, supported by the 50% retracement level at 1.3989.
This zone holds significant market memory, having served as a pivot for both buyers and sellers repeatedly since June. For bullish momentum to remain intact, buyers must defend this support area to prove the recent drop was merely a corrective pullback rather than a structural trend reversal. A successful defense would allow traders to eye another attempt at breaking above the 1.4023 high toward the 1.4050 resistance level.
Conversely, if sellers push the price below the 1.3989 level, the bullish structure could crumble, opening the door for further downside pressure. Forex traders will be watching closely to see whether buyers step in near the psychological 1.4000 mark or if persistent selling forces a deeper correction in the pair.
