The USD/CAD pair shows signs of fading bullish momentum as it consolidates around the 1.40 mark — a crucial pivot for upcoming trends. With Canada’s economic data improving and the Fed’s rate decision approaching, traders are eyeing whether this level will hold or mark the start of a broader correction.
Canadian dollar buyers haven’t had fundamentals on their side for a while, and despite US-Canada trade deal talks going into limbo, they show signs of reappearance.
This comes as the October FOMC rate decision approaches fast (October 29), which should further converge the rate differential between the USD and the CAD.
A previously degrading economic picture for the northern neighbor has started to show signs of small progress, with downward surprises to data being less frequent as of late.
Housing starts are making a comeback after a rough two-year period, and Canadian employment has surprised to the upside for the first time in a while.
This has been evident in the slowing buying momentum over the past week, following a consolidation/correction in price action.
The pair hovers around the 1.40 handle, which serves as a key barometer for upcoming action: whether the monthly session closes above or below that pivot area could determine future trends in the pair.
USD/CAD 4H chart, October 27, 2025. Source: TradingView. Past performance is not indicative of future results.
Resistance levels
- Liberation Day zone around 1.4050
- Past week high resistance 1.4080 (+/- 75 pips)
- 1.41 psychological resistance
Support levels
- 1.40 Major pivot (immediate support)
- Mini support around 1.3960
- 1.3925 Higher timeframe pivot/support & MA 200
- 1.38 major support +/- 150 pips
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