Canadian Dollar Forecast: USD/CAD Weekly Reversal Puts Yearly Uptrend Back in Focus 8 29 2026

USD/CAD has staged its strongest weekly advance since June, shifting the focus to whether a more durable low is finally taking shape.

Written by

Michael Boutros

Sr. Technical Strategist

Sat, 29 Aug 2026, 02:00 PM

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USD/CAD posted its strongest weekly advance since mid-June after a four-week decline of more than 3.6%.
The yearly rising technical structure keeps the broader bullish outlook viable while above key support.
The recovery still needs follow-through to suggest a more significant low is in place and shift the focus back toward trend continuation.
A renewed break lower would undermine the reversal and increase the risk of a larger decline toward the yearly lows.
The BoC rate decision and U.S. and Canadian employment reports headline a busy start to September.
Resistance 1.3944/56 (key), 1.4051, 1.4141/51– Support 1.3844/66, 1.3725/67 (key), 1.3617

USD/CAD has snapped a four-week losing streak, rebounding more than 1% from the August low after the recent decline stalled just above the yearly open. The broader yearly uptrend remains viable, but buyers still need to clear key resistance to strengthen the case that a more durable low is in place. With major Canadian and U.S. event risk on deck into the start of September, the focus is on whether this week's rebound marks renewed trend strength or simply a pause within the larger correction. Battle lines drawn on the USD/CAD weekly technical chart.

Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Loonie setup and more. Join live on Monday’s at 8:30am EST.

Canadian Dollar Price Chart – USD/CAD Weekly

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Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/CAD on TradingView

Technical Outlook: In last month’s Canadian Dollar Technical Forecast we noted that USD/CAD was, “trading just below pivotal resistance ahead of tomorrow’s highly anticipated FOMC rate decision. The focus is on a breakout of the 1.4017-1.1455 range for guidance.” USD/CAD broke lower the following week with a four-week decline plunging more than 3.6% before exhausting just above the yearly open. A newly identified ascending pitchfork extending off the yearly low offers some guidance here and the focus is on whether this rebound keeps the yearly uptrend intact or just a short-term recovery within a larger trend reversal.

Weekly resistance is now eyed at the April high-week close (HWC) and the 38.2% retracement of the yearly range at 1.3944/56. Note that the 25% parallel converges on this level in the weeks ahead and a breach / weekly close above would be needed to suggest a more significant low is in place and fuel the next leg higher in price. Subsequent resistance is eyed at the 61.8% retracement of the June decline at 1.4051 and the November high / 2025 February low at 1.4141/51. Note that the median line converges on this level in mid-September- look for a larger reaction there IF reached.

Look for initial support near the 200-day & 52-week moving averages (currently ~1.3844/66) with key support steady at 1.3725/66- a region defined by the yearly open, the 2025 low-week close (LWC), and the August LWC. Note that the lower parallel converges on this zone over the next few weeks and a break / weekly close below this slope would be needed to invalidate the yearly uptrend and threaten a larger decline towards the yearly lows. Subsequent support rests with the 2026 LWC at 1.3617 and the yearly low close at 1.3563.

Bottom line: USD/CAD rebounded off pivotal support this week with the rally now approaching initial resistance into the close of August. From a trading standpoint, losses would need to be limited to 1.3844 IF price is heading higher on this stretch with a close above 1.3955 needed to fuel the next major leg of the advance.

A busy economic calendar could keep USD/CAD volatility elevated into the start of September, with Wednesday’s Bank of Canada rate decision taking center stage. While policymakers are widely expected to remain on hold, the accompanying guidance will be closely scrutinized for clues on the policy outlook. Attention then turns to key U.S. and Canadian employment data later in the week, with the Non-Farm Payrolls and Canadian jobs reports on Friday offering an important read on labor market conditions on both sides of the border. With expectations for a September Fed rate hike building, any meaningful divergence in the employment data could drive a sharp repricing in the relative policy outlook and fuel increased volatility in USD/CAD. Stay nimble into the releases and watch the weekly close for directional guidance. Review my latest Canadian Dollar Short-term Outlook for a closer look at the near-term USD/CAD technical trade levels.