• USD/CAD struggles to gain any meaningful traction amid a combination of diverging forces.
• The US-Iran ceasefire extension weighs on the USD and acts as a headwind for spot prices.
• Retreating Crude Oil prices undermine the Loonie and support the pair amid a mixed setup.

The USD/CAD pair fails to capitalize on the previous day's modest recovery from the 1.3630 region, or its lowest level since March 13, and remains on the back foot during the Asian session on Wednesday. Spot prices, however, lack bearish conviction and currently trade just above mid-1.3600s, down only 0.05% for the day.

The US Dollar (USD) edges lower in reaction to a temporary extension of the US-Iran ceasefire and turns out to be a key factor acting as a headwind for the USD/CAD pair. Meanwhile, the latest optimism exerts some downward pressure on Crude Oil prices, undermining the commodity-linked Loonie and offering some support to the currency pair. Traders also seem reluctant to place aggressive directional bets amid persistent uncertainties surrounding US-Iran peace talks.

This week's fall below the 61.8% Fibonacci retracement level of the February-March upswing comes on top of a breakdown through the 200-period Exponential Moving Average (EMA) on the 4-hour chart and favors the USD/CAD bears. Furthermore, the Relative Strength Index (RSI) around 39 stays below the neutral 50 line, hinting that sellers still have the upper hand, even as the Moving Average Convergence Divergence (MACD) edges slightly into positive territory near the zero line.

The mixed technical setup suggests only tentative stabilization rather than a clear bullish shift. Hence, any attempted recovery is more likely to confront an immediate hurdle near the 61.8% Fibo. retracement at 1.3680, followed by the 50% retracement at 1.3735 and the 200-period EMA at 1.3761. A sustained break above this band would be needed to ease the current downside pressure and open the way toward 1.3790 en route to 1.3858.

On the downside, initial support is seen at the 78.6% retracement at 1.3602, with a drop through this level exposing the March swing low near 1.3525 and the 1.3500 psychological mark as the next significant bearish target.

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

USD/CAD 4-hour chart