Table of Contents

1. Introduction
2. Why USDCAD Is Turning Bearish
3. Central Bank Week: BoC vs FOMC
4. Today’s Market Structure & Key Levels
5. Conclusion

Introduction

USDCAD enters one of the most critical weeks of Q4 as traders brace for back-to-back rate decisions from the Bank of Canada (BoC) and the Federal Reserve (FOMC).
With the US dollar weakening under a dovish Fed tone and the Canadian dollar strengthening on robust labour data and stable rate expectations, the pair remains broadly bearish on both higher and lower timeframes.

This setup is primed for volatility, and opportunity, as price approaches major technical inflection points.

Why USDCAD Is Bearish

Several macro drivers are aligning:

1. Weakening USD from dovish Fed rhetoric

Recent Fed communication continues to lean dovish, softening USD demand as markets lean toward a potential December rate cut.

2. Stronger CAD supported by labour data

Canada’s latest jobs figures came in solid, reinforcing expectations that the BoC will not cut rates at the upcoming meeting.

3. Oil stabilizing supports CAD flows

With Canada’s currency tightly linked to energy markets, the stabilization in oil prices adds a layer of fundamental support to CAD strength.

4. Multi-timeframe bearish structure

MRKT structure shows consistent lower highs and lower lows, aligning both intraday and higher timeframe bias to the downside.

Central Bank Week: BoC vs FOMC

Both decisions fall on the same day, making this pair especially prone to disorderly intraday flow.

Bank of Canada (Expected: No Cut)

A neutral-to-hawkish tone is probable. Traders expect the BoC to avoid committing to cuts in early 2025, which reinforces CAD strength.

Expect:

• “Buy the rumor, sell the news” dynamic
• CAD likely firming into the event
• A hawkish lean could extend CAD strength post-decision

FOMC (Expected: Cut With Caution)

Even if the Fed cuts, there is a probability that the Fed will signal no immediate follow-through cut in January, keeping USD volatility elevated.

Expect:

• USD chop pre-statement
• Whipsaw risk during Powell Q&A
• Market digestion over the next session

Traders should be cautious: liquidity shrinks between these two events.

Today’s Market Structure & Key Levels

Despite the broader bearish structure, intraday price action shows a possible corrective bullish phase.

If price breaks above 1.38611

A deeper bullish pullback may unfold toward the 1.39 daily resistance zone, where higher-timeframe sellers are likely waiting.

If price breaks below 1.38041

Expect continuation of the dominant downtrend, with bears aiming for previous structural lows.

Conclusion

USDCAD begins the week firmly bearish as CAD strength and dovish US expectations collide. With both central bank decisions landing within hours of each other, traders should expect heightened volatility and asymmetric opportunities on key structural breaks.

Once the BoC and FOMC clear, sentiment and direction will likely reset — giving cleaner, higher-probability entries.