USDCAD follows oil and gold: the Canadian dollar gains ground

The USDCAD pair opened March and the spring season at 1.3649, with the market focused on commodity markets and the trajectory of the US dollar. Find out more in our analysis for 2 March 2026.

USDCAD forecast: key takeaways

• The USDCAD pair is declining in response to rallies in gold and oil
• Canada’s GDP came in weak, showing the softest performance since 2020
• USDCAD forecast for 2 March 2026: 1.3610

Fundamental analysis

The USDCAD rate is hovering around 1.3649 on Monday. Last Friday, the Canadian dollar recovered most of its monthly losses amid broad US dollar weakness.

Additional support for the CAD came from rising gold prices and a weakening US dollar. The strengthening of the precious metal adds to pressure on the USD, pushing the USDCAD pair lower. Financial flows at the end of the month also played a role, with the Canadian dollar losing about 0.1% in February.

Oil prices are climbing amid concerns over supply disruptions, which is a positive development for Canada as a major oil exporter.

At the same time, macroeconomic data was weak. Canada’s Q4 GDP contracted by 0.6% year-on-year, while markets had expected stagnation. This marks the weakest annual growth pace since 2020. The economy appears weaker than the Bank of Canada’s forecasts, although some details of the report were stronger than the headline figure.

The USDCAD outlook is moderately negative.

Technical outlook

In early February, the USDCAD pair gained a sharp downward momentum on the H4 chart, reaching a new low near 1.3510–1.3520. From this area, a strong reversal occurred, accompanied by widening Bollinger Bands, indicating heightened volatility and strong momentum.

The pair then recovered towards the 1.3710–1.3725 resistance zone but failed to consolidate above it, shifting into range-bound trading.

In recent sessions, the price has declined towards the 1.3625 support level and is attempting to stabilise. Bollinger Bands are gradually narrowing, signalling a transition from an impulsive phase to consolidation.

The key support level lies at 1.3625, followed by 1.3510, with the resistance level at 1.3725. While the medium-term structure after the reversal remains recovery-oriented, in the short term, the pair is moving sideways with moderate downward pressure.

USDCAD overview

• Asset: USDCAD
• Timeframe: H4 (Intraday)
• Trend: bearish
• Key resistance levels: 1.3650 and 1.3725
• Key support levels: 1.3625 and 1.3510

USDCAD trading scenarios for today

Main scenario (Buy Stop)

A move above 1.3650 would confirm a breakout from local consolidation and create conditions for growth towards the upper boundary of the range at 1.3725. The risk-to-reward ratio is close to 1:2, with potential upside of around 70 pips and a risk of approximately 35–40 pips.

• Take Profit: 1.3725
• Stop Loss: 1.3610

Alternative scenario (Sell Stop)

A breakout below 1.3625 would intensify short-term pressure and open the way towards 1.3510. Losing this zone would revive the downward momentum formed in early February.

• Take Profit: 1.3510
• Stop Loss: 1.3665

Risk factors

The key drivers for the USDCAD pair remain oil and gold prices, which support the CAD, as well as expectations for Bank of Canada policy following weak GDP data (-0.6% year-on-year in Q4). Additional pressure or support will depend on US dollar dynamics and changes in Federal Reserve rate expectations.

Summary

The USDCAD pair is declining due to news pressure, with the forecast for 2 March 2026 suggesting a move lower towards 1.3610.

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