USD/CAD dropped to a new weekly low as sellers broke through key moving averages and a midpoint support level. The pair now approaches its 200-day moving average, a level that reversed the decline the last time price tested it in June.
USD/CAD fell to a new weekly low at 1.3868 as sellers extended the stair-step decline that began when the pair peaked in mid-June. The move pushed the weekly range to nearly 100 pips, wider than the 56-pip range that had confined the pair earlier in the week.
Sellers clear several technical levels
The pair broke below its 100-day moving average at 1.39185, then through Wednesday's low at 1.3908, opening the door for further downside momentum. It also moved below the 100-hour moving average at 1.39295 after holding resistance within the 1.3948 to 1.3966 swing area earlier in the week.
USD/CAD then broke below the 50% midpoint of the move up from the May 1 low near 1.3550 to the June 24 high at 1.4247, a level near 1.3900. The break below that midpoint marks another technical win for sellers in the decline from the June high.
200-day moving average in view
The decline has stalled just ahead of two downside targets: a channel trendline near 1.3859 and the 200-day moving average at 1.3852. That moving average is a key barometer for both buyers and sellers, since the last time USD/CAD traded below it, back around June 1, price based near 1.3810 before reversing sharply higher and eventually reaching the 2026 high at 1.4247 on June 24.
As a result, some apprehension is possible on the first test of the 1.3852 level. Sellers who entered at higher levels may take profits there, while dip buyers may lean against the average looking for a corrective bounce, since it offers a clearly defined area to limit risk.
A sustained break below the 200-day moving average would represent another bearish technical development and open the door for further downside momentum. Conversely, a bounce from that average alone would not turn the picture bullish — buyers would need a move back above the 100-day and 100-hour moving averages in the 1.3920–1.3930 area to unsettle sellers.
For now, the stair-step trend remains lower, with the 200-day moving average shaping up as the next major test.
Source: Investinglive
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