Canadian Dollar flows slow to a crawl ahead of central bank showdown

• The Canadian Dollar remains trapped in near-term volatility against the US Dollar.
• The Bank of Canada and the Federal Reserve both deliver interest rate decisions this week.
• The US continues to battle its own position in trade talks on multiple fronts.

The Canadian Dollar (CAD) churned within familiar levels on Monday as investors brace for double-header central bank showings this week. Both the Bank of Canada (BoC) and the Federal Reserve (Fed) will be debuting their latest interest rate decisions on Wednesday, and USD/CAD flows will likely remain hampered until Loonie traders can get a sense of how the rate differential will shape up.

US President Donald Trump continues to spiral into protracted trade spats with the majority of the US's closest trading partners. Investors are still betting that fresh China tariff threats will give way to another acquiescence from the Trump administration. Closer to home, Donald Trump severed all trade talks with Canada after growing irate at a political commercial that aired in key US states, which directly quotes former President Ronald Reagan on the dangers and general idiocy of using tariffs as a trade policy.

Daily digest market movers: Canadian Dollar slows to a crawl ahead of interest rate decisions

• The Canadian Dollar has held steady within a familiar technical zone against the US Dollar.
• USD/CAD remains hamstrung near 1.4000 as markets await new reasons to pick a direction.
• The BoC's latest rate call is due on Tuesday, alongside the Fed's latest interest rate decision.
• The Fed is on pace to deliver a second straight interest rate cut for 25 bps.
• The BoC's outlook is much more complex, making the BoC's potential decision to cut rates a riskier proposition.

Canadian Dollar price forecast

USD/CAD continues to consolidate just below the 1.4050-1.4080 resistance zone after a strong October rally. The pair remains above both the 50-day EMA (1.3914) and 200-day EMA (1.3889), maintaining a constructive short-term structure.

Price has pulled back modestly over recent sessions, showing early signs of stabilization near 1.3980-1.4000. A sustained close above 1.4080 would signal renewed momentum toward the 1.4150 area, while a breakdown below the 50-day EMA could open the door for a deeper retracement toward 1.3850 support.

RSI sits near mid-range, indicating neither overbought nor oversold conditions. For now, the market is pausing within an uptrend that remains intact unless the pair loses the 1.39 handle.

USD/CAD daily chart