The pair trades near multi-year highs as lower crude prices and USD strength weigh on the Canadian Dollar.
USD/CAD hovered around 1.3979 on Friday, just below the 1.4000 resistance level, after reaching 1.4024 on Thursday, its highest since November 2025. The move follows a decline in West Texas Intermediate crude oil to near $83.50 per barrel, a two-month low, pressuring the commodity-linked Canadian Dollar.
The Loonie has faced steady selling pressure since early May, driven by geopolitical tensions favoring the USD as a safe haven. Stronger US economic data and favorable interest rate differentials have further supported the greenback. Despite overbought technical conditions, the pair remains above key moving averages, signaling a bullish trend.
Technical indicators suggest a strong but stretched uptrend, with the Relative Strength Index near 75 and the Average Directional Index at 33. While upside momentum may persist, the risk of a near-term pullback has increased.