USDCAD gains ground on risk aversion and soft Canadian data

USDCAD spent the morning of March 27 hovering near the 1.38510 threshold, catching its breath after a powerful rally seen in previous sessions. Such a pause feels temporary—more like a moment of hesitation than a sign of exhaustion.

The main engine behind this move is still geopolitical. Washington may have dialed back the rhetoric and extended the diplomatic timeout into early April, yet the market isn't holding out hope. With tensions simmering and no real breakthrough being in sight, investors are sticking to what really works: safe havens. And the dollar remains their go-to.

The loonie, meanwhile, is getting squeezed from all sides. Yes, Canada is an oil exporter, and crude prices stay elevated—this is usually a tailwind for the currency. But right now, risk-off sentiment is running the show, drowning out the fuel link. To make matters worse, the domestic picture looks pretty shaky. Exports plunged 14.6% in January, and February delivered a brutal jobs drop—84,000 positions were completely wiped out. The Bank of Canada (BoC) isn't rushing to the rescue either. Senior Deputy Governor Carolyn Rogers made it clear the regulator is comfortable staying on hold until the fog clears. This is hardly the kind of backing the loonie needs.

From a technical perspective, the pair is inching toward the 1.39000 resistance—a level that could trigger a local slowdown. In particular, the Stochastic Indicator is climbing and flirting with overbought territory. No reversal signal yet, but the warning lights are flickering. The Chaikin Oscillator is still in the positive zone and trending up, a sign that funds are currently flowing into the pair. But here is the catch: its ascent is lagging behind the price—a subtle hint that bullish momentum may be starting to fatigue. Down below, support sits at 1.37150, a threshold where buyers have previously stepped in with conviction.

For those looking to act, pay attention to the trading plan down below:

Buy USDCAD when the pair goes back to the 1.38050–1.37700 range. Place Take Profit at 1.39000. Set Stop Loss at 1.37150.

This forecast holds true from March 27 till April 3, 2026.