USD/CAD is trading around 1.3930, extending its pullback for a second consecutive session. Despite the short-term weakness, the broader technical picture remains bullish as the pair continues to trade within an ascending channel.

Key Takeaways
🔹 Bullish structure remains intact: USD/CAD continues to hold above both the 9-day EMA and 50-day EMA, supporting the ongoing uptrend.
🔹 Six-month highs back in focus: If buyers regain momentum, the pair could retest the June 9 high at 1.3969, with a move toward the psychological 1.4000 level becoming increasingly likely.
🔹 Momentum remains strong: The 14-day RSI sits near 69, reflecting strong bullish momentum. However, the indicator is approaching overbought territory, suggesting that upside gains could slow before the next breakout attempt.

Technical Levels to Watch
📈 Bullish Scenario
A sustained move above 1.3969 could trigger another leg higher.
Upside Targets:
🎯 1.3969 – Six-month high
🎯 1.3990 – Upper boundary of the ascending channel
🎯 1.4000 – Major psychological resistance

📉 Bearish Scenario
Failure to hold above near-term support may invite a deeper correction.

Support Levels:
⚠️ 1.3900 – 9-day EMA
⚠️ 1.3785 – 50-day EMA
⚠️ 1.3780 – Lower channel support
⚠️ 1.3481 – January low and major structural support

Outlook
The overall trend for USD/CAD remains constructive while price stays above 1.3900. Although momentum indicators suggest the rally may be nearing overbought conditions, buyers continue to control the broader structure. A breakout above 1.3969 could pave the way toward the 1.4000 milestone, while a drop below 1.3900 may signal the start of a corrective phase.

Bottom Line: USD/CAD maintains a bullish bias, with traders watching closely for either a breakout toward 1.4000 or signs of exhaustion near current highs.