USD/CAD Price Forecast: Can six-week lows at 1.3968 hold as the US Dollar softens?

Fresh six-week lows below 1.3960 mark a third straight day of declines for USD/CAD.
The US Dollar weakens as a surge in demand for US Treasury bonds drives yields sharply lower.
Oil prices close to five-month highs fuel a rally in the Canadian Dollar.

Downward pressure on USD/CAD persists on Friday, with the US Dollar (USD) declining against the Canadian Dollar (CAD) for a third straight day. Risk aversion is weighing on US Treasury yields, while elevated Oil prices are supporting the commodity-sensitive Canadian Dollar. Testing six-week lows at 1.3968, the pair remains on course to lose more than 2% over a three-week sell-off.

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

Investors moved out of equities and into the safety of US Government Bonds during the US and Asian sessions after disappointing results from Google Alphabet revived fears of an AI bubble. The retreat in US Treasury yields has deepened, with the US 10-year yield down more than 30 basis points in October, adding to selling pressure on the Greenback.

By contrast, elevated prices for Oil, Canada’s main export, continue to underpin the Loonie. With the US and Iran still far from reaching a peace deal and attacks continuing on vessels seeking to pass through the Strait of Hormuz, Brent Oil remains above 112.00 per barrel. It is on course to end the month nearly 20% higher.

Technical Analysis: Could a break below 1.3968 put the 1.3900 area in focus?

Bears retain firm control as USD/CAD maintains its downward trend around 1.3961. On the 4-hour chart, the Relative Strength Index (14) stands at 32.5, close to oversold territory, while the Moving Average Convergence Divergence (MACD) sits just below zero.

If a break below support around 1.3968 (the 23 October low) is confirmed, attention would shift to the mid-September lows near 1.3900, followed by the 78.6% Fibonacci retracement level around 1.3875.

To relieve downside pressure, however, bulls would need to clear Thursday’s high near the psychological 1.4000 level, followed by the 21 and 23 October highs in the 1.4070-1.4080 zone.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

How Is the Canadian Dollar Performing Today?

The Canadian Dollar recorded its strongest performance against the US Dollar today. The table below sets out the Canadian Dollar’s (CAD) percentage changes against the major currencies listed.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.16%	-0.39%	-0.27%	-0.21%	-0.02%	-0.17%	-0.38%
EUR	0.16%		-0.23%	-0.11%	-0.04%	0.16%	-0.02%	-0.22%
GBP	0.39%	0.23%		0.13%	0.19%	0.38%	0.22%	0.00%
JPY	0.27%	0.11%	-0.13%		0.07%	0.25%	0.09%	-0.11%
CAD	0.21%	0.04%	-0.19%	-0.07%		0.18%	0.03%	-0.18%
AUD	0.02%	-0.16%	-0.38%	-0.25%	-0.18%		-0.16%	-0.36%
NZD	0.17%	0.02%	-0.22%	-0.09%	-0.03%	0.16%		-0.20%
CHF	0.38%	0.22%	-0.01%	0.11%	0.18%	0.36%	0.20%

Percentage movements between the major currencies are displayed in the heat map. Select the base currency in the left-hand column and the quote currency in the top row. To view CAD (base)/USD (quote), for instance, select the Canadian Dollar on the left and follow that row across to the US Dollar; the intersecting cell shows the percentage change for that pair.