The USD/CAD pair is maintaining its bullish trajectory, trading near a fresh monthly high of 1.3850. This surge reflects a divergence in North American economic sentiment as the market prepares for next week’s crucial U.S. Non-Farm Payroll (NFP) report and navigates the fallout from recent trade policy shifts.
The Canadian Dollar (Loonie) is currently facing a dual-threat of a resurgent U.S. Dollar and increased uncertainty regarding the 2026 USMCA Review and cross-border tariff rhetoric.
Market Analysis: The 1.3850 Catalyst
The ascent to 1.3850 is a result of structural shifts in both fiscal and monetary outlooks:
NFP Positioning: Wall Street analysts have set a high bar for the upcoming NFP report, with a target of 200,000 new jobs. Traders are aggressively buying the Greenback on the assumption that a strong print will force the Federal Reserve to maintain its 3.50%–3.75% rate floor, or even consider a 25-basis-point hike to combat persistent services inflation.
The Trade Overhang: The Canadian Dollar remains sensitive to the new 15% global U.S. tariff framework. As Canada’s largest trading partner, any disruption to the automotive or energy supply chain directly impacts the Loonie’s valuation.
Oil Market Contradiction: While WTI Crude prices rose to $67.27 this week due to geopolitical tensions in Geneva, the traditional correlation between oil and the CAD has weakened as traders focus on the widening yield gap between the Fed and the Bank of Canada (BoC).
Technical Analysis: USD/CAD (Feb 28, 2026)
| Metric | Level / Value | Market Significance |
| Current Spot | 1.3850 | 30-day high established Feb 27 |
| Primary Resistance | 1.3895 | High from November 2025; major ceiling |
| Key Support | 1.3720 | 100-day Moving Average floor |
| RSI (14-Day) | 64.0 | Approaching overbought territory |
| NFP Target | 200,000 | Critical threshold for USD continuation |
